Harmonisation vs Convergence

Order Description

Assignment Task:

“The concept of convergence first arose in the late 1950s in response to post World War II economic integration and related increases in cross-border capital flows.
Initial efforts focused on harmonisation—reducing differences among the accounting principles used in major capital markets around the world. By the 1990s, the notion of harmonisation was replaced by the concept of convergence—the development of a unified set of high-quality, international accounting standards that would be used in at least all major capital markets…” (FASB, 2015).
Required:
• Distinguish between harmonisation and convergence, providing benefits and limitations of both concepts
• Appraise the adoption of IFRS in the EU as an example of successful convergence.

In October 2002, the FASB (Financial Accounting Standards Board) and the IASB (International Accounting Standards Board) announced the issuance of a memorandum of understanding (“Norwalk Agreement”), marking a significant step towards formalising their commitment to the convergence of U.S. and international accounting standards. Since then, both boards have been involved actively in a joint project to develop a common conceptual framework.
Required:
• Evaluate the qualitative characteristics of useful financial information (both the fundamental qualitative characteristics and the enhancing qualitative characteristics) outlined in the new conceptual framework for financial reporting.

?What is expected within students’ answers?
Your coursework must be in a report format, with an introduction.
The main body must address the above issues, and a conclusion summarising your report.
All external sources used must be adequately cited and referenced using the Harvard style of referencing.