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History of International Accounting Standards

The document outlines the evolution of International Financial Reporting Standards (IFRS) from the establishment of the International Accounting Standards Committee (IASC) in 1973 to the formation of the International Accounting Standards Board (IASB) in 2001, which facilitated global adoption of IFRS. It highlights the significant milestones in the adoption of IFRS by various countries, particularly the European Union's decision in 2002 to mandate IFRS for publicly traded companies. The IASB continues to update IFRS to address emerging issues and ensure its relevance in global financial reporting.

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25 views37 pages

History of International Accounting Standards

The document outlines the evolution of International Financial Reporting Standards (IFRS) from the establishment of the International Accounting Standards Committee (IASC) in 1973 to the formation of the International Accounting Standards Board (IASB) in 2001, which facilitated global adoption of IFRS. It highlights the significant milestones in the adoption of IFRS by various countries, particularly the European Union's decision in 2002 to mandate IFRS for publicly traded companies. The IASB continues to update IFRS to address emerging issues and ensure its relevance in global financial reporting.

Uploaded by

Tia
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© © All Rights Reserved
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Accounting Standards

Indian Accounting Standards


International Financial Reporting
System
International Financial Reporting Standards

Early Beginnings and Need for Global


Standards
• Pre-1973: Financial reporting standards
varied widely from country to country,
creating inconsistencies in global
financial reporting. Different accounting
practices made it difficult for investors
and businesses to compare financial
statements across borders.
International Financial
Reporting Standards

Establishment of the IASC


1973: The International Accounting
Standards Committee (IASC) was formed
by accountancy bodies from ten countries
(Australia, Canada, France, Germany,
Japan, Mexico, Netherlands, the United
Kingdom and Ireland, and the United
States). The IASC aimed to develop
globally accepted accounting standards.
International Financial
Reporting Standards

Development of IAS 1973-2001


The IASC issued International Accounting
Standards (IAS), which were adopted by
various countries. However, adoption was
voluntary, leading to inconsistent
application.
International Financial
Reporting Standards

EU Adoption and Global Spread


2001: The IASC was restructured and
became the International Accounting
Standards Board (IASB). The IASB
replaced the IASC and assumed
responsibility for setting International
Financial Reporting Standards (IFRS).The
IASB continued to develop and issue new
standards under the IFRS framework,
while the IAS issued by the IASC were
adopted as part of the IFRS framework.
International Financial
Reporting Standards

Formation of the IASB and the Advent of


IFRS
2002: The European Union decided to
adopt IFRS for the consolidated financial
statements of all publicly traded
companies within the EU from 2005
onward. This was a significant step in
promoting the global adoption of IFRS.
2005: Over 7,000 listed companies in the
EU switched to IFRS, marking a major
milestone in the history of IFRS.
International Financial
Reporting Standards

Further Global Adoption


2000s-Present: Many countries around
the world, including major economies
such as Australia, Canada, India, and
Japan, either adopted IFRS or converged
their national standards with IFRS. The
IASB worked closely with the Financial
Accounting Standards Board (FASB) in the
United States to align IFRS with U.S.
Generally Accepted Accounting Principles
(GAAP).
International Financial
Reporting Standards

Continuous Evolution
2010-Present: The IASB continues to
update and improve IFRS, addressing
emerging issues in global financial
reporting. The board engages with
stakeholders through consultations,
public meetings, and other forms of
outreach to ensure that IFRS remains
relevant and effective.
Summary
• The history of IFRS is marked by a
transition from fragmented national
standards to a more cohesive and globally
accepted framework.
• The establishment of the IASC in 1973 laid
the foundation, and the formation of the
IASB in 2001 was a pivotal moment that
propelled the global adoption of IFRS.
• Today, IFRS plays a crucial role in fostering
transparency, comparability, and
consistency in financial reporting
worldwide.
Indian Accounting Standards
• Source:
[Link]
[Link]
[Link]
rting-standards-ifrs-and-indian-accounting-standards-ind-as/

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