Chapter 12, Problem 12.1Q

To determine

Concept Introduction:

Accounting standards are rules and regulations for accounting. Accounting standards are prepared and released by the accounting board of the nation. Each standard indicates the accounting rules and guidelines for specific accounting needs.

To indicate:the need of adoption of single set of high quality accounting standards.

Explanation of Solution

Globalization has demanded countries to connect with all countries all over the world to take the advantage of overseas business. A multination company doing business in different nations faces the problem in accounting as each nation has different set of accounting standards. This problem has given need for a single set of high quality accounting standards which can be used globally. The globalization has given birth to the need of uniform accounting in the form of International Financial Reporting Standards (IFRS).