IFRS and M&A: more transparency but at a cost

Author: | Published: 1 Jul 2005

Global convergence of accounting standards - the rules by which companies communicate their financial performance to their shareholders and market - has never appeared so close. Since no single country's own standards would be acceptable worldwide, it has fallen to a non-national body to promote International Financial Reporting Standards (IFRS), as the answer for global capital markets.

The International Accounting Standards Board (IASB) is based in London. Its standards will, from this year, be used on a mandatory or optional basis by nearly 100 countries. That sounds a lot, but it still leaves many first world economies following their own route. Some big economic blocs have opted for IFRS - the EU being the most significant - but several are still on the outside, most notably the US and Japan, leading to some tension in the regulatory environment. The IASB is nominally aiming for one-size-fits-all regulatory environments, but it has no...