International Financial Reporting Standards (IFRS) Essay

International Financial Reporting Standards (IFRS) - Essay Example The policies of IFRS are more advanced and precise for meeting the changes in the new accounting and audit systems, so US is also moving towards IFRS. The US GAAP is actually concept based, whereas IFRS is based on principles. The methodology of these two frameworks and the accounting treatments are also different. In US GAAP, the research is mainly based on the literature but in case of IFRS, the rules are mainly based on reviews and patterns of facts. Table of Contents International Financial Reporting Standards (IFRS) 4 Generally Accepted Accounting Principles (GAAP) 5 Different between IFRS and GAAP 5 International Financial Reporting Standards (IFRS) International Financial Reporting Standards (IFRS) is a principle based framework created to develop new standards of accounting and auditing. The International Accounting Standards (IAS) was renamed as IFRS and the policies of IAS was also changed or renewed under this. The IFRS was constructed to develop a globalised accounting an d auditing model. The IFRS approves three main accounting models: The current cost accounting, maintenance of financial capital in the units of the constant purchasing power and the capital for maintaining nominal monetary units. IFRS follows three basic assumptions: Going on Concern: It states that an entity will continue its activities and any form of hindrance would not stop it from doing so. The assumption for proper and stable measuring units: The changes in the purchasing ability of functional currency excluding the 26 percent p.a. for consecutive 3 years can be considered immaterial for not considering the capital maintenance as stated in the guidelines of IFRS. Purchasing Power: It considers the constant power to purchase at all levels of inflation and deflation in relation to the consumer price index. Generally Accepted Accounting Principles (GAAP) The Generally Accepted Accounting principles (GAAP) are the rules in relation to accounting and auditing which are used for pre senting, and preparing the financial reports or statements for different entity. It includes the policies for the entire accounting and auditing industry. The GAAP is actually set or formulated by the Government Accounting Standard Board (GASB). The basic objectives of GAAP are: To safe guard the interest of the investors. To help the authorities take important financial decisions. It plays a significant role in maintaining records. It improves the performance of the organization (Cerritos, n. d.). Different between IFRS and GAAP The basic difference between IFRS and US GAAP framework are: Inventory: Under the system of IFRS, the LIFO system cannot be used, but in GAAP both LIFO and FIFO are allowed. So companies have choices in the second case. Cost of Development: In case of IFRS the

Global Perspectives on Innovation and Creativity Essay

Global Perspectives on Innovation and Creativity - Essay Example From this paper highlight that the products created by EMC are sold to customers that use a variety of computing platforms and key applications. The market target for this company is the global 2000, mid ten market and service providers. VMware is a technology firm that has enabled multiple operating systems. Some of the systems include, the MICROSOFT WINDOWS, LINUX and NETWARE. It also provided virtual infrastructure software for industry standard Intel based servers as above. The software’s performed a variety of services which included evaluation, deployment and implementation of disaster recovery. This paper discusses that the adoption of the VMware software’s in the EMC Company would allow enterprise customers to improve their server utilization rates and dynamically allocate work load across multiple services. This is because the VMware software has more potential therefore the integration with the EMC will lead to greater innovations. The main question that the essay is portraying whether the EMC Corporation should integrate with the VMW. The paper basically examines the importance of adopting the centralised system of management, the advantages and disadvantages that come with it. How resources can be allocated in a centralised organization. The central tenet of organization theory holds that the structures systems and process of a firm should be independent and must be mutually supportive and coherent. It therefore emphasizes on the need of the EMC Corporation to merge its operations with VMware. Furthermore it is proposed that the organization that is pursuing innovation, which in this case is the EMC, development of software’s should acquire a mode of supporting organizational structure. In this case, the centralized system will be settled upon.