A Brief Note On International Financial Reporting Essay

Analysis of Proposed Amendments to IFRS 3 Natalie A. Szczep September 17, 2016 International Financial Reporting ACG4253 Abstract Over the previous 2 years, the IASB conducted a review of IFRS 3, which is the definition of a business. The conclusion was that this definition needed to be revised, and this is one of the current projects open for comment with the IASB. The following pages will examine what the proposed revision will entail and how this may affect US companies. Also mentioned will be the effects of this amendment based on how IFRS and US GAAP are applied. Further, the focus can also be shifted to evaluate how this amendment would affect a US company doing business abroad. IFRS 3 defines what a business is and how to account for the purchase of a business. The interpretation of what a business is makes a crucial starting point in preparing financial statements and required information. A set of assets purchased may not be defined as a business (Exposure Draft ED/2016/1, 2016). When the IASB did their review of IFRS 3 over the last two years, the result was that users are noticing complications surrounding how a business is defined in IFRS 3. There was also a review done in the US by the FASB on the equivalent standard in US GAAP and the results were very similar. In response to this, the IASB and the FASB have collaborated and come up with possible changes to IFRS 3 that would alleviate these issues. Since IFRS 3 was a resultShow MoreRelatedA Brief Note On International Financial Reporting Standards Essay864 Words   |  4 Pagesregulations that applied to those businesses. International American corporations are now facing the challenge of conv erting from United States Generally Accepted Accounting Principles (US GAAP) to International Financial Reporting Standards (IFRS) in a near future. 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