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Paper Abstract: This paper provides a brief review of proposals to develop a classification system for the categorization of national accounting systems. The United Kingdon and the United States were used to illustrate the effectiveness of such systems in developing an understanding the accounting regimes in different countries. Paper Introduction: the purpose of attempts to develop classification systems in internationalaccounting The increasing globalization of economic activity has demonstrated aneed for coherence in accounting standards The efforts to develop suchcoherence referred to most often as either convergence or harmonization are led by the International Accounting Standards Board IASB based inLondon The IASB however meets strong opposition from both business andprofessional accounting interests representing a wide diversity ofcountries The strongest opposition however comes from highly developedeconomies where business professional and governmental interests contendvariously that Text of the Paper: The entire text of the paper is shown below. However, the text is somewhat scrambled. We want to give you as much information as we possibly can about our papers and essays, but we cannot give them away for free. In the text below you will find that while disordered, many of the phrases are essentially intact. From this text you will be able to get a solid sense of the writing style, the concepts addressed, and the sources used in the research paper. F. F., and Doupnik, T. Advanced Accounting 8th ed. Thejustifications for these assignments are the different approaches to thedevelopment of GAAP in the two countries. Advanced Accounting 7th ed. The IASC has developed 34 International Accounting Standards (IAS)that are currently being applied. to Play by Its Rules: European Union Wants 'Convergence' and 'Harmonization' of Accounting Standards Based on the Principles Used in Europe - to the Detriment of U.S. The first of the proposed classification systems would groupnational accounting systems according to cultural commonalities. In the United Kingdom, acceptedbusiness practices are somewhat more influential than is the case in theUnited States. This classification typically is referred to as the Nobes Micro-MacroModel. Insight on the News 19 (1 April 2 3): 32-34.Fischer, P. M., Taylor, W. The second of the proposed classification systems wouldgroup national accounting systems according the characteristics of theenvironment within which the function of accounting takes place - legalsystem, taxation system, capital market structure, and the influence of theaccounting profession in the establishment of GAAP (Nobes and Parker Part1). Opposition also comesfrom less developed economies, however, with contentions that internationalstandards do not recognize unique conditions in their countries and thatthe costs of implementing the international standards are too great (Palau359). Comparative International Accounting 7th ed. The IASC is the principalorganization that is developing international accounting standards, and itis through the IASC that proponents of the international acceptance of thebody of IAS pursue the implementation of these standards globally (Quinn45). "Converging on the Language of Financial Reporting". There are differences in the approach to GAAP between the UnitedKingdom and the United States. B., Schaefer, T. "Ethical Evaluations, Intentions, and Orientations of Accountants: Evidence from a Cross-Cultural Examination". K. Even theenvironmental approach to systems classification, however, would notprovide a complete understanding of the differences in the accountingregimes in the two countries. [pic] d'Arcy (2 1) contends that neither of the approaches (cultural orenvironmental) is satisfactory as a classification system for nationalaccounting systems within an international accounting framework. The strongest opposition, however, comes from highly developedeconomies where business, professional, and governmental interests contendvariously that a single set of international accounting standards would (a)compromise industrial productivity (Berlau 32); (b) fail to coveractivities addressed in national accounting standards (Pacter 67); or (c)compromise national sovereign rights (Maiello 166). Cincinnati, Ohio: Thompson South-Western, 2 2.Hofstede, G. Several potentialsystems for the classification of national accounting practices have beenproposed. Thus, the classification system approachbased on cultural differences (and commonalities) would not be useful indeveloping an understanding of the accounting regimes in the two countries. Financial Executive 19 (March-April 2 3): 19-2 .Pacter, P. "Tower of Babel". One approach to the enhancement of harmonization in accountingpractices while attempting to satisfy some of the opposition toharmonization is the development of a classification structure that wouldintroduce higher levels of harmonization among the countries included in acategory group within s classification structure than would exist (at leastinitially) among the various classification categories. L. Ideally, the issues raised by theglobalization of the securities markets would help drive development ofinternational standards for accounting, auditing, and disclosure byissuers. London: Pearson Education, 2 2.Ostling, D. GAAP". Academy of Management Executive (1993): 22-29.Hoyle, J. Thus, the higher level of commonality ofGAAP and general financial reporting practices the lower the accounting-related risk to global companies and investors. Theassumption underlying this proposed classification system is that one candifferentiate national accounting systems according to a cultural behaviormodel such as the Hofstede (22-29) model (uncertainty avoidance, powerdistance, masculine/feminine, and individualism/collectivism). In contrast, the classification system based on environmentalconsiderations would provide a better basis for the development of anunderstanding of the accounting regimes in the two countries. The IASB, however, meets strong opposition from both business andprofessional accounting interests representing a wide diversity ofcountries. Forbes 17 (22 July 2 2): 166-167.Nobes, C., and Parker, R. The CPA Journal 73 (March 2 3): 67-73.Palau, S. "The New IASC Worldwide?" Strategic Finance 82 (December 2 ): 45-51. The most likelybody for the establishment of international accounting standards, accordingto some proposals, is the International Accounting Standards Committee(IASC), a branch of the International Federation of Accountants. Innovation and Success". the purpose of attempts to develop classification systems in internationalaccounting The increasing globalization of economic activity has demonstrated aneed for coherence in accounting standards. Thecultural commonalities of the two countries are rapidly changing, however,as each becomes more culturally diverse. J., and Cheng, R. Works CitedBerlau, J. Differences in the generally accepted accounting practices(GAAP) applied in different economies create potentially serious threats tocompanies that operate globally. International Advances in Economic Research 7 (August 2 1): 351-365.Quinn, L. Under such a model, a standard prospectus would be developed thatwould set forth agreed upon international standards for all blue-chipcompanies. "EU Wants U.S. Shesuggests the development of a classification system based on reportingrequirements. Within the context of an environmental model such as the Micro-MacroModel, both the United Kingdom and the United States would be assigned to amicro cell, but not to the same cell. K. The justification for these assignments is thecommon Anglo-Saxon culture that the two countries presumably share. "Convergence of IFRS and U.S. The efforts to develop suchcoherence, referred to most often as either convergence or harmonization,are led by the International Accounting Standards Board (IASB) based inLondon. One version of a classification based on the Nobes Model isillustrated below on this page. Nevertheless, strong arguments favor a convergence in internationalaccounting standards, and there has been progress in that direction(Ostling 19). [pic] 2. Considering the United Kingdom and the United States for purposes ofillustration, both countries would be placed in the same cluster if theclassification system were based on cultural differences (Fischer, Taylor,and Cheng Chapter 9). "Comparison of Cultural Characteristics". R. Similarly, with international standards concerning capitaladequacy, customer protection, principles of business conduct and insuranceof customer accounts, financial institutions could be freely established ona global basis and covered by international regulations. The United Kingdom would be assignedto the Business Practices, Pragmatic cell within the Micro Grouping, whilethe United States would be assigned to the Business, Economics Theory cellwithin the Micro Grouping (Hoyle, Schaefer, and Doupnik Chapter 11). Among the more prominent of the proposed classification-systemsare the following (d'Arcy, 2 1): 1. New York: McGraw-Hill, 2 4.Maiello, M. Oneproposed classification system based on this approach is illustrated belowon this page. If this paper is not what you are looking for, you can search again: Search for: or Click here to request an essay written just for you.

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