Discuss the advantages & disadvantages of Accounting standards
Posted by Ripon Abu Hasnat on Thursday, May 29, 2014 | 0 comments
The advantages of
accounting standards include:
1. Improved
comparability between financial statements prepared by different businesses
2. reduced costs to
users and preparers different accounting policies and definitions because there
are fewer choices to make.
The disadvantages of
Accounting Standard include:
1. Some choice is often
still allowed (so it is still difficult to compare financial statements
prepared under different accounting policy choices)
2. If there is no choice
at all, some businesses may be forced to apply inappropriate accounting
policies
3. It is usually hard to
write accounting standards so that unscrupulous businesses cannot still find a
way to manipulate or abuse the rules in order to mislead readers
4. The economic and
reporting environment is changing so rapidly that new accounting standards (or
changes to old ones) are always being required
5. New standards may be
inconsistent with old standards
6. It can be so difficult
to get everyone to agree on a new accounting standard that compromises have to
be made.
You can subscribe by e-mail to receive news updates and breaking stories.
0 comments for "Discuss the advantages & disadvantages of Accounting standards"
Leave a reply