INTERNATIONAL FINANCIAL REPORTING
STANDARDS (IFRS): AN OVERVIEW—Solutions
Discussion Questions
1. Convergence is a process through which the IASB works with the U.S. Financial
Accounting Standards Board (FASB) and other national bodies to achieve
2. Currently, IFRS are now acceptable under the AICPA Code of Professional
3. The main reasons put forth against the adoption of IFRS are that the IASB is
concerned principally with public companies and depends on large accounting
4. The main reason to support use of IFRS is that they would promote comparability
5. The proposal is for all financial statements to follow roughly the current
organization of the statement of cash flows. All statements will be divided into five
categories as follows:
6. Both U.S. GAAP and IFRS recognize accrual accounting as the key concept
underlying income measurement. However, the FASB and IASB implement this
7. Under U.S. GAAP, assets can reflect a variety of values based on both entry and
exit prices: fair value, purchase cost, amortized cost, replacement cost, and
8. Fair values are compatible with the conceptual framework for the following
reasons:
• They are relevant because they reflect conditions relating to economic
resources and obligations under which financial statement users will make