Domestic accounting standards developed to meet the needs of domestic environments. Which of these factors did not influence accounting standards locally? 1. A litigious environment in the United States that led to a demand for more detailed standards in many cases. 2. High rates of inflation in some countries that resulted in periodic revaluation of fixed assets and other price-level adjustments or disclosures. 3. Income tax conformity in certain countries that no doubt greatly influenced domestic financial reporting. 4. Reliance on open markets as the principal means of intermediating capital flows that increased the demand for information to be included in financial reports in the United States. 5. The need to have standards different from the U.S. standards.

Domestic accounting standards developed to meet the needs of domestic environments. Which of these factors did not influence accounting standards locally? 1. A litigious environment in the United States that led to a demand for more detailed standards in many cases. 2. High rates of inflation in some countries that resulted in periodic revaluation of fixed assets and other price-level adjustments or disclosures. 3. Income tax conformity in certain countries that no doubt greatly influenced domestic financial reporting. 4. Reliance on open markets as the principal means of intermediating capital flows that increased the demand for information to be included in financial reports in the United States. 5. The need to have standards different from the U.S. standards.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA1: International Financial Reporting Standards

Section: Chapter Questions

Problem 6MCQ

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Which of the following historical reasons for accounting diversity could explain why accounting standards would be more detailed in some countries than in others?a. Different rates of inflation across countries.b. Different legal systems across countries.c. Differences across countries in the extent to which financial statements are the basis for taxation.d. Political and economic ties between countries.
Which of the following historical reasons for accounting diversity could explain why accounting standards would be more detailed in some countries than in others? Choose the correct.a. Different rates of inflation across countries.b. Different legal systems across countries.c. Differences across countries in the extent to which financial statements are the basis for taxation.d. Political and economic ties between countries.
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What benefit does a country get out of remaining insularly and isolated in their accounting policies? (i.e. import policies, not following IFRS, etc.)
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