Document Type : opinion article
Author
Professor at the University of Tehran and financial, economic and investment strategies consultant
Abstract
Cross-boundary transactions and free flow of capital are the basis of modern economies. Over one third of total financial transactions occurs over the boundaries and is expected to increase. In past, as every country had its own financial standards, such a cross-boundary activities were complex. Using national standards causes diverse basics in financial statements and perhaps there are doubts in comparability, transparency and accountability of financial statement. In order to resolve this complexity, investigating the details of national standards is required. Because each little difference in requirements may cause huge effect on measuring companies' profit, its value and reported financial status. This is one of the important reasons of developing International Financial Reporting Standards (IFRS). Regarding the importance of the standard and on the other hand, being mandatory for big listed Iranian companies since 2016, this paper reviews the evolution path of the standards, emersion of IFRS, it's meaning and advantages, challenges and disadvantages of using them in order to introduce it to students and who are interested in.
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