Institutional Convergence in European Union Member States: The Evoluation of the International Accounting and Auditing Standarts

Institutional Convergence in European Union Member States: The Evoluation of the International Accounting and Auditing Standarts

Ayşenur Tarakcioğlu Altinay (Uşak University, Turkey)
DOI: 10.4018/978-1-7998-1188-6.ch018

Abstract

Economic globalization has affected accounting and auditing practices, as it has many other areas. Its impact on accounting has emerged in international accounting standards and independent auditing. There is pressure on the European Union countries to benefit from the New York segmentation of these standards. In parallel with these developments, IASB (International Accounting Standards Board) was established in 1973 to create a common accounting system for companies around the world, and internationally accepted accounting standards were established under the name of International Accounting Standards (IAS). To use these common accounting practices effectively, as of Jan. 1, 2005, publicly traded companies in the European Union have been obliged to apply the consolidated financial statements to the public in accordance with the International Financial Reporting Standards (IFRS) adopted by the European Union.
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International Accounting Standarts (Ias)

In the beginning, the International Accounting Standards Committee (IASC), which worked as a branch of the International Federation of Accountants (IFAC), became an independent organization at the General Assembly held in Edinburgh on 24 May 2000 with the participation of IFAC. According to the Charter approved in Edinburgh, the International Accounting Standards Board (IASB) established as the standard setting body of the new structure. As a result of this new restructuring, all publications and correspondence were decided to be made by IASB and thus from 2001 on, the IASB was responsible for developing and publishing standards and drafts and approving the comments of the Standard Interpretation Committee (IFRIC), replacing the IASC.

Key Terms in this Chapter

International Accounting Standards: International Accounting Standards (IASs) were issued by the antecedent International Accounting Standards Council (IASC), and endorsed and amended by the International Accounting Standards Board (IASB). The IASB will also reissue standards in this series where it considers it appropriate.

International Auditing Standards: International Standards on Auditing (ISA) are professionalstandards for the performance of financial audit of financial information. These standards are issued by InternationalFederation of Accountants (IFAC) through the International Auditing and Assurance Standards Board (IAASB).

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