The last modification date of the French accounting plan was in the year 1999. This change has increased the rigor given to accounting in French companies. The (International Accounting Standards or the IAS are developed by members of the NCC with transparency.
In Europe, the Commission proposed a draft regulation mandating IAS for the preparation of consolidated accounts of EU listed companies from 2005, which was approved by Parliament and the Council of Ministers of the European Union on March 12, 2002.
Europe will thus be the first region in the world to adopt the body of IAS, which represents a significant advance in international accounting harmonization. For French listed companies, production and communication of financial information, both internally and externally, will be modified in depth. All the changes that are imposed require a real project management.
The impact of standards and decisions that involve financial statements require the attention of executives and boards of directors. Besides the effect on the consolidated financial statements, it should start managing this project because it is necessary to consider all consequences related to of the transition to IAS.
While the IAS changed again by 2005, the changes were limited to items on the work programs of the IASB, which means that it is possible for companies to begin to prepare both the standards that are now stabilized on the expected changes.
How did the IAS, which has an international dimension, come to win against their main rival, the U.S. GAAP? The purpose of this report is to explain, firstly the IAS, and in the second part, it will undertake a comparison between IAS and other standards. Finally, it will consider the implementation of IAS in listed companies, and the consequences in terms of organization and communication of the changes involved.
The IASC was established in 1973 in order to "formulate and publishin the public interest, accounting standards to be observed for the presentation of financial statements and to promote their acceptance and application in the world."
In its Communication of 1995 on its new accounting strategy, the Commission proposed to Member States to allow global operators who wish to appeal to international capital markets to prepare their consolidated financial statements in accordance with IAS(International Accounting Standards).
Since then, seven Member States (Austria, Belgium, Germany, France, Finland, Italy,Luxembourg) have allowed listed companies to prepare their consolidated accounts in accordance with IAS or U.S. GAAP * (accounting principles generally accepted in the United States).
Two systems dominate the financial world. One American, comes from the Financial Accounting Standards Board (FASB), the agency responsible to issue accounting standards, known as U.S. GAAP for U.S. companies. The other, international, based on International Accounting Standards Committee (IASC), which produces the so-called IAS or IFRS standards through its Accounting Standards Board (IASB).
The main differences between French GAAP and accounts under U.S. GAAP include the goodwill (goodwill) allocations of goodwill on equity authorized by the former French GAAP, are not under U.S. GAAP ,
March 12, 2002, the European Parliament had approved almost unanimously a European Commission regulation mandating the adoption of IAS standards by listed companies of the Old World from 2005. The problem for companies is that not only that these two systems need to coexist for years, but they functon under a different philosophy.
Tags: Study of IAS (International Accounting Standards), the US GAAP, comparison between IAS and GAAP
[...] In France, the CNC * (National Accounting Council) also actively participated in the work of the IASB in particular the draft standard on provisions of the first application of IAS. It also worked towards convergence, futures, and French rules with IAS. II-The IAS standards over other standards Before addressing the issues related to the battle taking place between the GAAP and IAS, it is interesting that, today, the SEC still does not allow foreign companies to adopt IAS without making reconciliation to U.S. GAAP while many European companies are queuing up to enter the U.S. capital market. - IAS In France, the company accounts are heavily influenced by taxation. [...]
[...] "The IAS is based on principles and some leeway to companies and their auditors. The GAAP are based on very detailed rules. Americans have long said they were more reliable, but we realize now that it is much easier to divert them as they are not based on principles, "said Gilbert Gelard, a former auditor and CFO who sits on the IASB. The U.S. standards are certainly as effective as IAS. However, they were developed without any input from outside the United States. [...]
[...] IAS 41 Agriculture Date of entry into force Periods beginning on or after January Objective Establish accounting for agricultural activity, namely the management of the biological transformation of biological assets (living plants and animals) in agricultural products. Key Features ♣ All biological assets are measured at fair value less costs of distribution (sales commissions intermediaries, taxes . ) estimated at each balance sheet date, unless fair value can be measured reliably. ♣ Agricultural products are measured at fair value at the time of harvest, reduced distribution costs estimated. ♣ Since the products of the crop are marketable commodities, there are no exceptions to the reliability of the assessment of fair value for these products. [...]
[...] which, if exercised or converted, provide access to voting rights) to determine whether it has control (or influence significant) over another undertaking, and therefore the method of consolidation of this company. The company should consolidate the entity in terms of its percentage of voting rights present and affect potential voting rights in minority interests (it must be limited to the present and ignore the intent of the company to exercise the option). Exception to this principle: if the company has the property of the voting rights (in control of economic benefits and suffers the risk that comes with ownership of such securities), it must take into account these potential voting rights in the percentage ownership of the company (they are not classified as minority interests). [...]
[...] ♣ On de-recognition of financial instruments, IAS 39 establishes conditions for determining when control of an asset or a financial liability has been transferred to third parties and so when that asset or liability should be derecognized. ♣ IAS 39 allows hedge accounting in certain circumstances (definition of hedging instruments and elements that may be covered) provided that the hedging relationship is clearly defined, measurable and highly effective. ♣ IAS 39 defines three types of hedging relationships with different accounting treatments: the fair value hedge, the hedging of cash flows and hedging of net investments in foreign operations (as defined under IAS 21 The Effects of Changes exchange rates of foreign currencies), which is recorded as a cash flow hedge. [...]
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