THE DEBATE ON THE FUTURE OF THE INTERNATIONAL FINANCIAL REPORTING STANDARDS IN THE UNITED STATES: CRITIQUE AND CONSIDERATIONS
THE DEBATE ON THE FUTURE OF THE INTERNATIONAL FINANCIAL REPORTING STANDARDS IN THE UNITED STATES: CRITIQUE AND CONSIDERATIONS

Author(s): Hristina Oreshkova
Subject(s): Economy, Supranational / Global Economy, Business Economy / Management, Financial Markets, Public Finances, Business Ethics
Published by: Университет за национално и световно стопанство (УНСС)
Keywords: International Accounting Standards; International Financial Reporting Standards; U.S. Generally Accepted Accounting Principles; International Accounting Standards Board; Financial Accounting Standards
Summary/Abstract: In the present article a subject matter that has attracted great interest over the recent decades is analyzed. The critical question of the likelihood of incorporating the International Financial Reporting Standards into the financial reporting system of the United States has raised a lot of debates.The problem has been the focus of profound deliberations among both scientific and professional community. Our long-lasting research found out that the strategic goal of reaching one single set of global accounting standards through the project of convergence carried out by the most influential Boards – the International Accounting Standards Board located in London with second headquarters in Tokyo, and the U.S. Financial Accounting Standards Board, has not yet been achieved. It is appropriate to emphasize that the realisation of the project began as a result of the agreement reached in September 2002, Norwalk. However, it is increasingly recognized that the era of convergence probably is coming to an end. Prominent scholars argue that the strategic goal turned out to be neither practical norachievable in the foreseeable future. For the time being the authorized American institutions do not intend to completely adopt the International Financial Reporting Standards as issued by the IASB into the U.S. financial reporting system. It seems as though, the authoritative organizations in the United States attempt to continue keeping in line with the specifics of the U.S. business environment. It is assumed that the Securities and Exchange Commission will never perhaps risk causing a political storm by yielding the control over its accounting to an institution outside the USA. In my view, an essential reason that causes inconveniences in the implementation of the IASB’s standards globally is that the accounting principles and standards interact in different ways with national laws, social and ethic codes, domestic fiscal rules, and this process is unavoidable. However, in each state and jurisdiction the interaction has its characteristics and specifics. Complications may arise out of the local tradition, culture and historical continuity in performing accounting as a practice as well as the legal doctrine and the degree of their interrelation. No less important are the essence and peculiarities of the national legal and accounting system, the extent of cultural impacts on the contemporary development of accounting and the influence of the principles on the basis of which the systems of state authority are established, interact and function.

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