Convergence of US GAAP and IFRS

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Table of Contents

CHAPTER 03: RESEARCH METHODOLOGY1

Research Methodology1

Research Design: Empirical Study1

Qualitative Data Collection Technique3

Articles Search Technique4

Quantitative Data Collection Technique5

Data Analysis5

Validity7

Ethical Concerns7

CHAPTER 04: ANALYSIS AND DISCUSSION9

Globalization of Capital Markets9

Why Need for Convergence?11

Key Differences between GAAP and IFRS12

Convergence Problems16

Convergence in Various Countries20

Driving Forces of Harmonization26

Fundamental Analysis29

Financial Analysts and Investors33

CHAPTER 05: CONCLUSION37

Proposed impact of implementing IFRS over GAAP40

REFERENCES42

APPENDIX46

Survey Questionnaire46

CHAPTER 03: RESEARCH METHODOLOGY

Research Methodology

This section determines the study design and analysis. In this section of research evaluation proposal, discusses the various tools of research and also identifies the tools that are most important and appropriate for the findings of this research studies. This research was founded on the secondary data. The research encompassed the publications, articles and similar studies accessible on the internet. Keeping in view the approach taken in earlier studies the research began with a broad analysis of the existing literature. The findings & conclusions are based on the secondary data. The methodology used for the purpose of this research is based on the secondary data. The research approach used will be qualitative.

Research Design: Empirical Study

First of all, literature review is needed to understand main differences between International Financial Reporting Standards (IFRS) and Generally Accepted Accounting Principles in United States (US GAAP). Firstly, quantitative method is planned to use to understand application of these two standards in real life by examining publicized organizations' financial statements which use different accounting standards to compare them. Therefore, it can be stated that, quantitative method has been used to analyze data to find out differences and gaps between IFRS and US GAAP. Moreover, by examining multinational corporations' financial statements which have business transactions in different accounting standard zones, confusion and complexities have been detected for preparers, auditors, multinational corporations and investors. Hence, the areas which are needed to convergence between IFRS and US GAAP have been revealed. Moreover, in order to decrease differences between their system and IFRS, there are attempts in US GAAP to convert their system. Therefore, changes are examined to analyze results, advantages and disadvantages of them.

Furthermore, in order to understand problems and opinions of multinational corporations, preparers, accounting organizations and investors about the differences and convergence process between IFRS and US GAAP, a survey was planed. Therefore, as it is mentioned before, qualitative method was also used to explore effects of duopoly in accounting standards and process of convergence in United States. By using this survey, we aimed to find out, which type of problems they have because of the differences in accounting standards and what are their opinions about the convergence processes and which areas in accounting standards should be most problematic to need immediate convergence. Moreover, as a result of our literature review, we also found out surveys about our topic, so these surveys also were used to collect second hand data. I have already checked these two articles which are about the differences between these standards.

The articles by Zeff, S. A. (2008) Towards Convergence: A Survey of IFRS to US GAAP Differences and ...