Article analyze Essay Example | Topics and Well Written Essays - 750 words

Article analyze - Essay Example Enterprises are anticipated to follow GAAP guidelines when broadcasting their financial information in their financial statements. The article ‘New mechanisms of FASB and IASB’ discusses on whether to adopt the International Financial Reporting Standards or not. An argument prevails between the Financial Accounting Standard Board and (FASB) and the International accounting standard Board (IASB) over the adoption of such principles. On 10th January 2013, the leaders of the boards mentioned above held a meeting to discuss the formation of joint accounting Principles. IASB seemed not to agree with the mutual setting of the accounting principles. Instead, it seemed to be on the side of single-setting the accounting guidelines without involving FASB (Tysiac, 2013). The indecisiveness of SEC forced Hoogervorst, the chairman of FASB, to declare the harmonization of principle bodies in formulating common and accepted accounting principles. Hoogervorst stated that it was very imperative if the principle bodies moved closer and formed mutual standards (Tysiac, 2013). In the previous definition, it was clear that accounting standards are achieved only when policy Boards come closer to form a common Idea. Thus, the issue of the IASB formulating its rules without involvement of FASB is not classified as ‘the acceptable accounting principles’. As quoted from his speech, Hoogervorst said, ‘As long as there is no decision (by the SEC); the best you can do is try to move as close together as possible.’ I agree with him because for a principle to become accepted, all policy bodies must participate in formulating the standards (Tysiac, 2013). Hoogervorst idea of forming accepted accounting principles is very significant. First and foremost, it improves transformed precision. Secondly, it leads to likely simplification. Third, enhances transparency and finally, it helps to compare between different