SEC replaced CAP with the Financial Accounting Standards Board (FASB)
2008
AIA created Committee on Accounting Procedure
1973
1936
SEC asked for assistance from the American Institute of Accountants (AIA)
1934
1929
Stock Market Crash (a.k.a. The Great Depression )
GAAP(Generally Accepted Accounting Principles)
INTERNATIONAL GAAP NON GAAP
US GAAP
Japan GAAP
German GAAP
PRINCIPLES OF US GAAP
Accounting Accounting Accounting
concepts principles conventions
Business entity Cost principle Materiality
concept Revenue principle Consistency
Money measurement Matching principle Conservatism
concept Full disclosure Cost-benefit analysis
Going concern principle Industry practices
concept
Accounting period
concept
IFRS(International Financial Reporting Standards)?
Price :$1 110.58
Now more than 100 countries uses the completed IFRS or synchronized form
Now IFRS published, titled IFRS 1 First-time Adoption of International Financial Reporting
Standards.
2005
The IAS was implemented in countries European Union
2003
2002
Replaced by International Accounting Standards Board (IASB) in1 st April, 2001
2001
1973 International Accounting Standard were issued by International Accounting
Standards Committee (IASC)
IFRS(International Financial Reporting Standards)
IFRS 1 First-time Adoption of International Financial Reporting Standards
IFRS 2 Share-based Payment
IFRS 3 Business Combinations
IFRS 4 Insurance Contracts
IFRS 5 Non-current assets held for sales and discontinued operations
IFRS 6 Exploration for & Evaluation of mineral resources
IFRS 7 Financial Instruments: Disclosures
IFRS 8 Operating Segments
IFRS 9 Financial Instruments
IFRS 10 Consolidated Financial Statements
IFRS 11 Joint Arrangements
IFRS 12 Disclosure of Interest in other entities
IFRS 13 Fair Value Measurement
IFRS 14 Regulatory Deferral Accounts
IFRS 15 Revenue from Contracts from Customers
IFRS 16 Leases
ADVANTAGES OF IFRS
Allows for greater comparability
Beneficial to new and small investors
Creates more flexibility while adapting
Cost & time benefits
Acquiring multinational company
Reduction in accounting & operation cost
Access to international market
DISADVANTAGES OF IFRS
High cost
Prone to manipulation
Not globally accepted
FOR WHOM ?
Investors
Multinational Companies
Regulators
Securities Industry and Stock Exchanges
Developing Countries
IFRS(International Financial Reporting Standards)
BRAZIL
Adaptation started on Dec 2007
Full implementation on April 2010
Removed risk premium
2010 GDP growth @7.5% from 3.7%
Ranked 4th in 2010 FDI Confidence Index
2011, top 5 in FDI
REGULATORY BODIES
Trustee
The Board
Standing Advisory Council(SAC)
IFRIC (International Financial Reporting Interpretation Committee)
US GAAP VS IFRS
Basis US GAAP IFRS
Balance Sheet Current and noncurrent asset and Categories are required to be
liability categories are separated separated
Diff
ASB AuSB Committe
Accounting Standard
Board
Auditing Standard
Board
es Board
Disciplinary
NFRS
DEVELOPMENT OF NFRS
2016-17
2015-16
A Listed Multinational Manufacturing Companies
2014-15 Listed States Owned Enterprises(SOE) min paid up capital Rs 5b (except
BFIs)
Implementation of IFRS in Nepal
Convergence Method
ASB applying IFRS would work together with IASB
Countries converging with IFRS may deviate to a certain extent from IFRS
E.g Nepal
Adoption method
Implementing IFRS in the same manner as issued by the IASB and would be
100% complaint with the guidelines issued by IASB.
E.g Kenya
WHY DO WE NEED?
Enable us to adopt the international practice in preparation of financial
statement
Makes us presentable with the foreign competitors.
Add a solid foundation for the corporate sector development in Nepal
Help bring in foreign investors
STATUS OF NFRS AT PRESENT
ICAN to implement NFRS for listed companies, on 32 Ashadh 2067
Listed Multinational manufacturing companies and Listed
Loan Loss Provision Principle Based using Rule Based as per Income
expected loss model Tax Rule, 2058