Solutions To Add Practice Questions Ch4

Solutions to additional practice questions
Deegan & Unerman Financial Accounting Theory 2e

Chapter 4
dissolve 4.1: Chapter 4 has provided a number of factors which have been suggested to explain wherefore different countries use different systems of method of story. These include:
o The utmost of economic development within a country. It is argued that as countries survive more wealthy they tend to develop their own accounting standards (which mickle be costly). Less developed countries often take for granted accounting standards issued by the IASC (which may, or may not real be relevant to the entropy needs of the local people).
o It has been argued that the nature of the domestic business ownership and financing systems piece of ass influence the accounting methods being used within a country. For example, in countries which have companies that commit relatively more on equity capital (funds from many outsiders) there will be a tendency to provide greater disclosures than in countries with companies that rely relatively more on debt capital.
o It has been argued that the colonial heritage or history of a company will invasion the accounting methods employed.
o Invasion is an new(prenominal)(prenominal) factor that can affect accounting practices. A country invaded by another may have a particular method of accounting imposed upon it.




o A commonly mentioned reason for world(prenominal) differences in accounting is tied to the broad notion of heathen difference. Culture itself could be expected to influence other things (some already discussed above), such as legal systems, tax systems, and how businesses ar formed and financed, which will in turn influence the types of information demanded.
o Sources of aid or finance might excessively influence the accounting methods used. For example, an international funding organisation (such as the World Bank) might require that particular accounting rules be used as a condition of providing funds to a country.
o Religion, which is obviously linked to culture,...If you want to get a full essay, order it on our website: Orderessay



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