ifrs has a lot of advantages over the other


IFRS has a lot of advantages over the other accounting standards -

Provides consistency

Ensures better comparability across organizations across the globe

Decreases the cost of capital

Helps in raising capital abroad

Companies with subsidiaries in multiple countries can use the same accounting language across all countries.

With the IFRS, there is no need to develop and maintain national standards

Cross border acquisitions become easier with the IFRS standards being the same across the globe

Public in any part of the globe can understand the financial statements of overseas companies, suppliers, customers etc.

Easier consolidation

Although, IFRS has a lot of advantages over the GAAP, a lot of people believe that US GAAP is better than IFRS. IFRS has its own disadvantages in front of GAAP. The US organizations which do not have enough operations outside the US do not have enough incentive to prepare financial records as per the IFRS. Also, there are some filings with some authorities that require GAAP. Thus, for US organizations that need these filings, it results in additional costs to follow both GAAP and IFRS.  Moreover, IFRS is known to provide much lesser detail than the GAAP.  Christopher Nobes (1997).

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