Convergence of U.S. GAAP and IFRS

Convergence of U.S. GAAP and IFRS

Author Name : Rencia Pinto

ABSTRACT As there is continuous increase in globalization, international business and trading, and cross-border investments, the need for global comparability of financial statements has become extremely significant. This requires the existence of a global set of accounting standards which can be adopted by all countries. This research focuses on the convergence of the two extensively used accounting standards, that is theInternational Financial Reporting Standards (IFRS) and the United States Generally Accepted Accounting Standards (GAAP) and the opinion of the people regarding this convergence. Additionally, this paper presents a timeline of the process of convergence, an overview of the various joint projects undertaken by the FASB and IASB for the same and the advantages and disadvantages of the convergence. It also offers a conclusion as to whether continued efforts should be made for the convergence. For this, various research papers were reviewed in order to present an accurate and unbiased opinion. To obtain and understand the view point of the people on the convergence of the U.S. GAAP and IFRS, a survey was conducted in Pune, India and the sample population chosen mainly consisted of undergraduate, graduate and postgraduate students as these students would be accounting professionals in the near future and would most likely have to deal with this change.