Critically assess the extent of the benefits of adopting international Dissertation

Critically assess the extent of the benefits of adopting international financial reporting standards in lieu of a country's dome - Dissertation Example However, intense training is needed by the employees while implementing IFRS which in turn increases the cost in the financial recording process. Therefore, the adoption of IFRS over the already applied financial standards in the national context is quite likely to give rise to a few noteworthy challenges besides its advantages. Table of Contents Abstract 2 1.Introduction 4 2.Creation of International Financial Reporting Standards 5 2.1 IFRS in Political Environment in UK 8 2.2 Controversies Related to the Adoption of IFRS in UK 9 2.3 Advantages of Converting Into IFRS 10 2.4 Requirements to Attain Maximum Benefits from IFRS 13 2.5 Tax Impacts of Transitioning Into IFRS 15 2.6 Challenges Related to Incorporation of IFRS 15 2.7 Other Related Challenges 18 2.8 Concerns Arising from Implementation of IFRS 20 2.9 Reasons behind Altering UK GAAP 21 2.10 Differences between IFRS and UK GAAP 21 2.11 Critical Review of Adoption of IFRS 22 3.Conclusion 24 4.Recommendations 24 25 References 26 1. Introduction Comparing the financial statements of different reporting enterprises becomes a cumbersome task owing to the deviation in procedures along with the principles taken into account by these organisations in designing financial statements. With the intention of making these methods and principles uniform as well as comparable to a certain extent, financial recording standards are created. Theoretically, accounting standards are termed to be the statements of policy of practice which belongs to regulatory accounting bodies (Pearson Education, 2012). This policy of practice needs to be observed in the preparation as well as the presentation of the financial statements. In simple terms, accounting standards can be identified as written documents offered by the regulatory bodies within the nation or even in the international ground. It tends to comprise of numerous components such as measurement, treatment, revelation and presentation of the accounting transactions (ICAEW, 2012). The chief objective of enforcing accounting standards is to eliminate differences in the treatment related to numerous accounting aspects and hence to initiate uniformity in the financial presentation which further facilitates an accurate and transparent disclosure of monetary facts concerning a particular business. Accounting standards also aim to harmonise the varied accounting policies which is generally followed while creating and demonstrating the financial statements by distinct financial enterprises in order to assist in proper comparison between the inter-firm and intra-firm (ICAEW, 2012). However, in various occasions it has been observed that companies which function in accordance to the nationally implemented strategies often have to face certain challenges when adopting the internationally grounded financial standards. As noted by Brown (2011), â€Å"there will always be winners and losers from changes in accounting standards, if only because of their distributiv e effects, undoubtedly some consequences are regarded by companies and investors as, on balance, bene?cial† (pp. 269). Emphasising on these various aspects, the objective of the