HARMONISATION

 HARMONISATION
 HARMONISATION AND STANDARISATION
 ARGUMENTS FOR HARMONISATION
 DIFFICULTIES IN HARMONISATION.
 HARMONISATION
 Maintain uniformity in financial
accounting principles and practices at
the international level.
 Aims at narrowing the areas of
difference.
 Involves examining and comparing
different accounting systems.
 Steps to create uniformity.
 Standardization
 More uniform application of
accounting concepts rules and
principles.
 Adherence to more unified charts of
accounts and statements.
 Greater systemisation of all
accounting activities…
 Difference
• Harmonisation is the process of
increasing the compatibility of
Accounting practices by setting
bounds to their degree of variation.
 Standardisation appears to imply the
imposition of a more rigid and
narrow set of rules.
 Arguments for Harmonisation
 Growth in international business
 Investors
 Multinational companies
 International auditing firms
 Developing countries
 Other industrial groups
 Difficulties in harmonisation
programmes


Difficulties in
harmonisation

Difficulties Difficulties
in the In the Other
development Enforcement difficulties
of standards Of standards
 Difficulties in Development of
Standards
 Provincialism
 Differences in Economic and Social
Environment.
 Diverse Accounting Practices.
 Gaps between developed and
Developing Countries.
 Difficulties in Enforcement of
standards
 Tax Laws
 Disclosure laws
 Existence of local standards
 Competition among International
Standards- Setting Agencies
 Unhelpful Corporate Attitude.
 Other Difficulties
 Related to international standards-
setting agencies.
 IASC and International Federation of
accountants (IFAC) are criticized by
standard setting agencies.
 It was considered American bias.

 Irrelevant to the particular prevailing

political condition in the particular nation.

 These agencies have no authority to

implement its recommendation.