John Flower with Gabi Ebbers, editors, Global Financial Reporting.
This book has five parts. The first part, "Background," has three chapters that introduce the reader to the diversity of reporting and reasons for it and briefly cover regulations.
The second part has six chapters that cover accounting in Britain, the U.S., France, Germany, Japan (the five countries referred to as the countries of the "Pentad") and accounting in the European Union (ELI). The structure of coverage for the Pentad countries is similar. The authors have chosen to emphasize European countries rather than the EU because of the limiting influence of the EU on the financial reporting of the member states.
The third part of this book has five chapters, four of them dedicated to the development, standards, and framework of International Accounting Standard Board (IASB) created in April 2001 and one chapter devoted to the presentation of financial statements according to International Accounting Standard (IAS) No. 1 issued by the International Accounting Standards Committee, the predecessor of IASB. The authors emphasize IASs because they believe that, in addition to the U.S. Generally Accepted Accounting Principles (GAAP), IASs could be the global standards resolving problems encountered by multinational firms that are required to use multiple accounting standards.
The fourth part of this book has two chapters that cover the balance sheet and a chapter each for the income statement, cash flow, and consolidated financial statements. In these chapters, the authors cover IAS extensively with a brief comparison to the accounting standards and practices of the countries of the Pentad and to the multinational companies domiciled in these countries.
Selected issues are introduced in part five of this book. One chapter is devoted to each of the following issues: intangible assets, foreign currency translation, financial instruments, and disclosure. According to the authors these topics were selected because they offer opportunities to cover theoretical issues and because of their importance to practitioners. Each chapter discusses the importance of the issue and introduces and explains relevant accounting rules and reporting practices.
The Appendix to Chapter One lists Internet addresses of boards that set standards, as well as the addresses of regulators and professional and academic organizations. The Appendix to Chapter Thirteen presents the IASB's framework without the preface.
Each chapter has a stated objective, summary, and references. Review questions at the end of each chapter are essay-type questions. These questions would be quite useful for an instructor to assign to students. However, an instructor who prefers quantitatively oriented questions would find none in this book. In the section titled "Further Reading" at the end of each chapter, the authors identify sources for specific topics and make comments such as the extent of the information provided by the source identified. The authors use examples of reporting and disclosure from multinational companies of the Pentad throughout the book as well as information on these countries in relation to the topic covered in each chapter. Exhibits with useful information and diagrams are used extensively in this book.
The authors state the reasons for the in-depth coverage provided for a topic or a standard and for the sequence in which the topics are presented. For example, in Chapter Two on diversity of accounting, the authors explain why the topic of culture in relation to accounting was covered at the end of the chapter. Throughout this book, the authors also provide useful commentary and insights and arguments for or against the use of specific terminology, of a definition, or of an accounting approach. The authors express and articulate their opinions frequently on topics such as the usefulness of the IASB's Framework. Cross-references among topics are provided within the book itself. However, in some instances the authors make statements in respect to EU's directives without referring the reader to the applicable directives in the chapter on the EU.
There are some typographical errors. In Chapter Two, page 30, Exhibit 2.2, for example, three textbooks are compared in respect to factors that have influence on financial reporting, but one of textbooks was not cited in the references for that chapter. Exhibit 22.4 gives the wrong amount for the current exchange rate. Section 22.7.1 reports erroneously the amount of profit of 500 Euros instead of 1,000, and Section 22.8, p. 645 cites U.S. Financial Accounting Standard (FAS) No. 135 instead of 133. However, all of these errors are minor considering the significant contribution of this book to international and comparative accounting.
The authors indicate that this book is intended for students taking courses in accounting and finance in the last year of their undergraduate study or graduate courses. The book is descriptive in terms of accounting standards and practices. It does not provide numerical examples in respects to rules, standards, and applications. It does provide significant insight, comments, and arguments related to accounting standards. This book could be used in an accounting course covering comparative accounting or international accounting where the coverage does not require performing and solving numerical illustrations and problems. It could also be used as a supplemental book when an instructor has adopted a quantitative text for the course.
Samir I. Nissan
California State University, Chico
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|Author:||Nissan, Samir I.|
|Publication:||Journal of International Accounting Research|
|Article Type:||Book Review|
|Date:||Jan 1, 2004|
|Previous Article:||Shahrokh M. Saudagaran, International Accounting: a User Perspective.|