Effects Of Globalization On Accounting

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THE EFFECTS OF GLOBALIZATION ON ACCOUNTING Abstract: In the circumstance of globalization, the situation of accounting becomes complex and incites discussion and debate in aspects of trend, scale, and impact in accounting world. With the changes the globalization brings about, it is vital to comprehend what the changes are and how they influence the accounting. This paper aims to analyze the effects of globalization on accounting basically from three perspectives------ the effects on the Generally Accepted Accounting Principles, management accounting, and threats and opportunities for accountants. Introduction Every industry faces unavoidable changes in this rapidly globalized century, so does accounting. With the widespread technology,…show more content…
The businesses scale up every single day and keep enlarging the circle they can cover so that they can obtain more information and achieve more goals. Obviously, this can affect accounting field and make a big progress. As the business scale increases to international, accounting will record more transactions over many different countries. But in this recording process, the issue is that every country has divergent accounting concepts, reporting practices, and principles. The distinction between two countries causes barriers in the transaction process and measurement system. For example, the trade between U.S. and Canada will consider both US GAAP and Canada GAAP and the transaction process will be complicated and time-consuming. We firmly believe this situation is not what international businessman want to see. The desire of harmonization appears intense and the need of international trade comes considerably high. Global accounting demands unified accounting…show more content…
In the past, the accounting job in the United States as well as in the whole world gave off an impression of being focused on the planning and evaluating of financial statements. Numerous people consider Certified Public Accountants (CPAs) and different specialists of bookkeeping when someone mentions accounting. Then again, in different parts of the globe, management accounting is a division of the accounting field (Sahi & Dua 2012). In such parts of the world, management accounting and financial accounting are considered two separate professions. As a subdivision management accounting manages monetary and non-money related data to bolster a scope of administrative choices. Then again, its financial side focuses on budgetary information just to bolster both investors’ and creditors’ choices on capital distribution (Kinney & Raiborn 2008). On the other hand management accounting essentially concentrates on enhancing business execution yet not guaranteeing that the business fits in with the set gauges. From this viewpoint, it is evident that management accounting is always dominated by financial
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