There was a news item today that India has decided
to adopt a new accounting system (IRFS) by 2011. IRFS is presently adopted by
over 109 countries including China. I was curious on this move, found two references
on the Internet to understand this.
1) Accounting
in a global world
2) Debits
& Credits of IFRS
This is what I understood: Just like how Technology standards and Protocols are vital
for the Interconnected world of Internet to work together, it is equally important
in globalized world today to have a common way to report financial's of companies
around the world. Without such a standard it brings in huge disparity in disclosure
thus creating loopholes to hide facts. All of this affects investor confidence and
long term sustenance of the global economy. In short, it is a welcome move provided
our government enacts all necessary law framework without delay.
Read the complete post at http://www.venkatarangan.com/blog/2008/03/27/India+To+Adopt+IRFS+Accounting+System.aspx