RSM219H1 Chapter Notes - Chapter 2: International Accounting Standards Board, International Financial Reporting Standards, Accounting Equation
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RSM219H1 Full Course Notes
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Document Summary
The guidelines that the companies follow while measuring, collecting, recording, and reporting the information in a standardized view. Benefits: they enhance the usefulness of the statement because they ensure that users understand the information; the evaluation and comparison of 2 companies becomes easier, and hence, users can make better investment choices. Public companies have to follow the ifrs (international financial reporting standards) and private companies generally follow the aspe (accounting standards for private enterprise) but have the option to follow ifrs. Most public companies are multinational and are listed in many stock markets across the globe, ifrs makes the information easy to understand by users and cuts down extra work for firms. Aspe has simplified standards to reduce the burden of financial reporting on private companies. These standards are set in place to make the understanding easier for users - shareholders (currents and potential) and creditors.
