America vs. Europe. The battle between accounting standard setters

Table of Contents

1. History FASB / IASB

1.1 The International Accounting Standards Board (IASB).

1.2 The FASB

1.3 What is Convergence

1.4 The rise of the convergence process

1.4.1 The rise of the convergence Process (1960’s – 2001)

1.4.2 The convergence process today.

1.5 Discussion on the convergence process

1.6 Summary

2. Standard Setting & Lobbying

2.1 Standard Setting

2.2 Lobbying

3. Research Outline

4. Research

5. Conclusion

Research Objective & Topics

This research investigates whether the worldwide applicable financial accounting standards are converging towards a model that is predominantly American or European. By analyzing comment letters regarding one-way convergence Exposure Drafts issued by the FASB and the IASB between 2005 and 2009, the study evaluates the influence of different stakeholders on the standard-setting process and determines the direction of the convergence path.

• Convergence processes between US GAAP and IFRS
• Influence of lobbying and comment letters on standard setters
• Distinction between "fixed" and "incidental" commenter groups
• Analysis of specific Exposure Drafts from IASB and FASB
• Evaluation of stakeholder support and standard-setter dominance

Excerpt from the Book

Summary of Chapters

1. History FASB / IASB: This chapter outlines the origins and development of the FASB and IASB, providing context for their missions and the necessity of convergence.

2. Standard Setting & Lobbying: This chapter details the procedural frameworks used by both boards and explains how external parties exert influence through lobbying and the comment letter process.

3. Research Outline: This chapter describes the methodology for identifying, categorizing, and selecting one-way convergence standards for empirical analysis.

4. Research: This chapter presents the empirical results, including statistical analysis of comment letters, for the selected IASB and FASB exposure drafts.

5. Conclusion: This chapter summarizes the findings regarding the direction of the convergence process and provides a final discussion on the overall research question.

Keywords

Convergence, IFRS, US GAAP, Accounting Standards, FASB, IASB, Lobbying, Comment Letters, Financial Reporting, Stakeholders, Standard Setting, Global Capital Markets, Reconciliation, Financial Statements, Regulation

Frequently Asked Questions

What is the core focus of this research?

The research examines whether the ongoing convergence between IFRS and US GAAP results in accounting standards that lean more towards American or European regulatory philosophies.

Which stakeholder groups are identified in the analysis?

The study distinguishes between a "fixed group" of regular commenters (e.g., audit firms, standard setters) and an "incidental group" of commenters who participate less frequently.

What is the primary methodology applied?

The author performs an empirical analysis of comment letters submitted during the exposure periods for one-way convergence standards between 2005 and 2009.

How is the influence of stakeholders measured?

Influence is assessed by classifying comment letters into categories ranging from "not supportive" to "fully supportive" and calculating a weighted tendency value for each proposed standard.

What does the main body of the work cover?

The main body details the historical backgrounds of the boards, their due process, lobbying mechanisms, and a comprehensive analysis of specific IASB and FASB Exposure Drafts.

Which keywords best describe the research?

Key terms include convergence, IFRS, US GAAP, lobbying, standard setting, and stakeholder influence.

Does the IASB exhibit a different approach to commenters compared to the FASB?

Yes, the research finds differences in the composition of commenter groups and their tendencies, with IASB proposals often facing stronger negative sentiment from the fixed group of commenters.

What is the conclusion regarding the direction of convergence?

The author concludes that on important subjects, the IASB is moving towards the FASB, suggesting that the resulting global regulations are becoming more American than European.