What were the 'International Accounting Standards - IAS'

International Accounting Standards (IAS) are older accounting standards which were replaced in 2001 by International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB), an independent international standard setting body based in London.

BREAKING DOWN 'International Accounting Standards - IAS'

International Accounting Standards (IAS) were the first international accounting standards that were issued by the International Accounting Standards Committee (IASC), formed in 1973. The goal then, as it remains today, was to make it easier to compare businesses around the world, increase transparency and trust in financial reporting and foster global trade and investment.

Benefits of International Accounting Standards

Globally comparable accounting standards promote transparency, accountability and efficiency in financial markets around the world. This enables investors and other market participants to make informed economic decisions about investment opportunities and risks, and improves capital allocation. Universal standards also significantly reduce reporting and regulatory costs, especially for companies with international operations and subsidiaries in multiple countries.

Progress Towards Universal Adoption of IFRS

There has been significant progress towards developing a single set of high-quality global accounting standards since the IASC was replaced by the IASB. IFRS have been adopted by the European Union, leaving the U.S., Japan (where voluntary adoption is allowed) and China (which says it is working towards IFRS) as the only major capital markets without an IFRS mandate. As of 2018, 144 jurisdictions require the use of IFRS standards for all or most publicly listed companies, and a further 12 jurisdictions permit its use.

The U.S. is exploring adopting international accounting standards. Since 2002, America's accounting-standards body, the Financial Accounting Standards Board (FASB) and the IASB have been collaborating on a project to improve and converge U.S. generally accepted accounting principles (GAAP) and IFRS. However, while the FASB and IASB have issued norms together, the convergence process is taking much longer than was expected - in part because of the complexity of implementing the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The Securities and Exchange Commission (SEC), which regulates U.S. securities markets, has long supported high-quality global accounting standards in principle, and continues to do so. In the meantime, because U.S. investors and companies routinely invest trillions of dollars abroad, fully understanding the similarities and differences between U.S. GAAP and IFRS, is crucial. To learn about the differences between IFRS and GAAP, read What are some of the key differences between IFRS and U.S. GAAP?

  1. International Financial Reporting ...

    International Financial Reporting Standards (IFRS) are a set ...
  2. Accounting Changes And Error Correction

    Accounting Changes and Error Correction refers to guidance on ...
  3. Standardization

    Standardization is a framework of agreements to which all relevant ...
  4. Accounting Interpretation

    Accounting interpretation is a statement, issued by accounting ...
  5. Accounting Research Bulletins - ...

    Accounting Research Bulletins were documents published by the Committee ...
  6. Standard of Value

    A standard of value is the understood worth of a commodity used ...
Related Articles
  1. Investing

    International Reporting Standards Gain Global Recognition

    Comparing financial numbers from corporations in different countries is possible with the adoption of IFRS.
  2. Investing

    GAAP And The IFRS Standards Convergence Efforts In 3 Substantial Areas

    Understand the specific steps that have been taken in hopes of converging the GAAP and the IFRS accounting standards, despite the philosophically and culturally based methodological differences ...
  3. Investing


    Learn more about the generally accepted accounting principles, standards and procedures that companies use to compile their financial statements.
  4. Investing

    Grasp the Accounting of Private Equity Funds

    Read about private equity accounting and how it is different than that of other investment vehicles. The nature of private equity makes a difference.
  5. Personal Finance

    How Fiduciary and Suitability Standards Differ

    There are big differences between how advisors and brokers qualify investments for clients.
  6. Insights

    Standard of Living Vs. Quality of Life

    What is the difference between a standard of living and quality of life? Find out in this breakdown.
  7. Investing

    Gold Standard Stock Falls After Issuing Shares (GSV)

    Gold Standard said it will use proceeds from the private placement to make various investments.
  1. What does financial accounting focus on?

    Learn the main tenets of financial accounting, the guidelines by which it is governed and how outsiders use it to gauge a ... Read Answer >>
  2. Who enforces GAAP?

    Take a deeper look at the private enforcement mechanisms behind the generally accepted accounting principles for American ... Read Answer >>
  3. Does US GAAP prefer FIFO or LIFO accounting?

    Investigate the use of LIFO and FIFO inventory accounting methods under U.S. GAAP, and learn why there is pressure from some ... Read Answer >>
  4. What are the objectives of financial accounting?

    Learn about the principle objectives of financial accounting, including the furnishing of the financial statements for those ... Read Answer >>
  5. What is a relative standard error?

    Find out how to distinguish between mean, standard deviation, standard error and relative standard error in statistical survey ... Read Answer >>
  6. How should a change in accounting principle be recorded and reported?

    Learn about changes in accounting principle and why businesses make them, as well as the reporting and recording requirements ... Read Answer >>
Trading Center