Research Paper on:
Debate on the Necessity of IAS

Unformatted Sample Text from the Research Paper:
that allowed Enron to do what it did. Now professionals are putting forward the case that if there had been a standardized system of International Accounting Standards (IAS) that Enron  never would have happened. IAS has been something that the United States accounting industry has been fighting for years, however, claiming that the U.S. systems are more rigorous than any  international or foreign systems. Other opponents of the IAS also believe that having truly international standards would be impossible, as countries throughout  the world have different markets, political systems, legal systems and development, so standardization would be impossible. It is the position of this paper, however, to demonstrate that because of the  growth of the global economy, and because trade barriers are starting to collapse due to that growth, that some type of international accounting system will be necessary so that all  companies are on the same page in terms of financial accountability. First, lets examine why, exactly, an Enron type of situation would  not have happened under an IAS. The U.S. Generally Accepted Accounting Principals, or GAAP, provide a checklist of auditors and accountants to follow (Europes Bean Counters are Sneering, 2002). IAS,  however, is based more on general principles, which force auditors to comply with the spirit of the law, rather than the letter of the law (Europes Bean Counters are Sneering,  2002). In other words, under IAS, Enron auditors would have examined the numbers - and interviewed management as to why it had moved assets and liabilities off the balance sheet  (Europes Bean Counters are Sneering, 2002). Whatever management told them, auditors then would have had to draw their own conclusions (Europes Bean Counters are Sneering, 2002). In short, intentions, in