AIR

And Now There Are Three: IFRS for SMEs

In May 2008, the AICPA Governing Council recognized the IASB as an accounting body for purposes of establishing high quality accounting standards and with an amendment to Appendix A of AICPA Rules 202 and 203 gives AICPA members the option to use IFRS as an alternative to US GAAP. Thus, private companies were given the option of using IFRS. (The SEC has not made this option available for public companies.) The IASB has now made a third option available for private companies in the U.S. by issuing IFRS for Small, and Medium-Sized Companies (SMEs). This latter development has the potential for significant change in accounting practice and accounting education.
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Accounting Instructors’ Report, Fall 2009: Table of Contents

TRENDS
And Now There Are Three: IFRS for SMEs

Belverd E. Needles, Jr., Ph.D., CPA
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German Cost Accounting vs. Activity-Based Costing

Activity-Based Costing is often used in cost/managerial accounting as a cost measurement, yet accounting practices can differ widely between countries. To be able to recognize difference and similarities in seemingly identical practices between countries provides an opportunity for improvement and allows managers to draw managerial implications in light of the increasing internationalization of companies. This paper compares the USA Activity-based Costing (ABC) and the German (GPK) Activity-based costing. The paper establishes differences based on purpose, cost, concepts construction and cost allocation, and quantity and quality of cost information.

From this research it appears that many of the enterprises in the USA as well as those in other countries should take a look at the ways their international counterparts successfully measure and manage organization performance, in order to resolve limitations in North American practices and in referencing the German Cost Accounting system.

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