Author Question: In general, what factors influence a country's accounting system? How do accounting system ... (Read 123 times)

bobbie · **on:** Jul 7, 2018

In general, what factors influence a country's accounting system? How do accounting system differences among countries affect international firms?

What will be an ideal response?

Question 2

There is a strong relationship between skewed income distributions and the split between those who live in urban settings versus those who live in rural areas.

Indicate whether the statement is true or false

momtoalll · **Reply #1 on:** Jul 7, 2018

Answer to Question 1

Differences in the policies and procedures of national accounting systems can create significant operational and control problems for an international business, which must develop an accounting system that provides both the internal information required by its managers to run the firm and the external information needed by shareholders, lenders, investors, and government officials in all the countries in which the firm operates. A country's accounting standards and practices reflect the influence of legal, cultural, political, and economic factors. Differences among countries' accounting practices affect a firm's decisions on: reported income and profits, valuations of assets and inventories, tax reporting, desire to operate in a given country, and use of accounting reserves.

Answer to Question 2

TRUE