International Accounting Standards: A New Perspective

The International Accounting Standards Committee (IASC) was founded in 1973 with the following objectives: 1. to increase harmonization of accounting standards among countries, 2. to develop a basis for underdeveloped countries to follow as an accounting profession emerges in those countries, and 3. to focus on the accounting and reporting responsibilities of multinational companies. The IASC's international accounting standards are generally very broad, often containing 2 or more acceptable alternatives. In the past, these accounting standards have not been taken very seriously in the US. However, with the emergence of significant cross-border financings and the consequent interest of various national securities regulators, that is likely to change in the near future. Accounting harmonization has taken on greater importance and is now a key ingredient in fostering efficiency in the phenomenon of high-volume cross-border finance.