Comparative International Accounting, 14th Edition

637 Pages·2020·5.37 MB·English

by  Christopher Nobes, Robert Parker

FOURTEENTH EDITION
C O M PA R AT I V E
I N TE R N ATI O N A L
AC C O U N T I N G
CHRISTOPHER NOBES
ROBERT PARKER
COMPARATIVE
INTERNATIONAL ACCOUNTING
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14th Edition
COMPARATIVE
INTERNATIONAL
ACCOUNTING
Christopher Nobes
and
Robert Parker
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First published 1981 (print)
Thirteenth edition published 2016 (print and electronic)
Fourteenth edition published 2020 (print and electronic)
© Prentice Hall Europe 1991, 1995, 1998 (print)
© Pearson Education Limited 2000, (print)
© Pearson Education Limited 2002, 2004, 2006, 2008, 2010, 2012, 2016, 2020 (print and electronic)
Chapter 17 (formerly 18) © John Flower 2002, 2004, 2006, 2008, 2010, 2012, 2016
The rights of Christopher Nobes and Robert Parker to be identified as authors of this work have been asserted by them in accordance
with the Copyright, Designs and Patents Act 1988.
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copyright: This publication contains copyright material of the IFRS® Foundation in respect of which all rights are reserved. Reproduced by
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ISBN: 978-1-292-29646-3 (print)
978-1-292-29648-7 (PDF)
978-1-292-29650-0 (ePub)
British Library Cataloguing-in-Publication Data
A catalogue record for the print edition is available from the British Library
Library of Congress Cataloging-in-Publication Data
Names: Nobes, Christopher, editor.
Title: Comparative international accounting / Christopher Nobes.
Description: 14th edition. | Harlow, England ; New York : Pearson, 2020. |
Includes bibliographical references and index. | Summary: “Comparative
International Accounting is intended to be a comprehensive and coherent
text on international financial reporting. It is primarily designed for
undergraduate and postgraduate courses in comparative and international
aspects of financial reporting. A proper understanding requires broad
overviews (as in Part I), but these must be supported by detailed
information on real countries and companies (as in Parts II to IV) and
across-the-board comparisons of major topics (as in Parts V and VI).
This book was first published in 1981. Until this present edition (the
fourteenth), the book was jointly written by Christopher Nobes and
Robert Parker. However, Bob Parker died shortly after the thirteenth
edition was published in 2016. This edition is dedicated to his memory;
see obituaries in the 2016 volumes of Accounting and Business Research
and Accounting History. Bob’s last publication was a review of the
development of the contents of this book (and therefore of the world of
international accounting) over its thirteen editions from 1981 onwards.
Readers can consult this in Volume 21 (Issue 4) of Accounting History”—
Provided by publisher.
Identifiers: LCCN 2019047248 (print) | LCCN 2019047249 (ebook) | ISBN
9781292296463 (paperback) | ISBN 9781292296487 (ebook)
Subjects: LCSH: Comparative accounting.
Classification: LCC HF5625 .C74 2020 (print) | LCC HF5625 (ebook) | DDC
657—dc23
LC record available at https://lccn.loc.gov/2019047248
LC ebook record available at https://lccn.loc.gov/2019047249
10 9 8 7 6 5 4 3 2 1
24 23 22 21 20
Cover: Robert Decelis Ltd/Taxi/Getty Images
Print edition typeset in 9.5/12.5pt Stone Serif by SPi Global
Print edition printed and bound in Malaysia
NOTE THAT ANY PAGE CROSS REFERENCES REFER TO THE PRINT EDITION
Brief contents
Contributors xvi
Preface xvii
Part I SETTING THE SCENE
 1 Introduction 3
 2 Causes and examples of international differences 27
 3 International classification of financial reporting 59
 4 International harmonisation 90
Part II FINANCIAL REPORTING BY LISTED GROUPS USING
IFRS OR US GAAP
 5 The background to financial reporting by listed groups 123
 6 IFRS in context: concepts, presentation and revenue 155
 7 IFRS in context: assets and liabilities 175
 8 IFRS in context: group accounting 209
 9 Different versions of IFRS practice 229
10 Financial reporting in the United States 248
11 Political lobbying on accounting standards: US, UK
and international experience 279
Part III CHINA AND JAPAN
12 Financial reporting in China and Japan 315
v
Brief contents
Part IV FINANCIAL REPORTING BY INDIVIDUAL COMPANIES
13 The context of financial reporting by individual companies 351
14 Harmonisation and transition in Europe 364
15 Making accounting rules for unlisted business enterprises in Europe 388
16 Accounting rules and practices of individual companies in Europe 413
Part V SPECIAL ISSUES IN REPORTING BY MNEs
17 Foreign currency translation 443
18 Segment reporting 479
Part VI MONITORING AND ENFORCEMENT
19 International auditing 509
20 Enforcement of financial reporting standards 540
APPENDICES
A. Synoptic table of accounting differences in eight GAAPs, 2020 559
B. Glossary of abbreviations 562
C. Suggested outline answers to some of the end-of-chapter questions 568
Author index 585
Subject index 590
vi
Contents
Contributors xvi
Preface xvii
Part I SETTING THE SCENE
1 Introduction 3
Contents 3
Objectives 3
1.1 Differences in financial reporting 4
1.2 The global environment of accounting 6
1.3 The nature and growth of MNEs 15
1.4 Comparative and international aspects of accounting 18
1.5 Structure of this book 21
Summary 23
References 24
Useful websites 25
Questions 26
2 Causes and examples of international differences 27
Contents 27
Objectives 27
2.1 Introduction 28
2.2 Culture 29
2.3 Legal systems 31
2.4 Providers of finance 33
2.5 Taxation 38
2.6 Other external influences 41
2.7 The profession 43
2.8 Conclusion on the causes of international differences 43
2.9 Two examples of international differences 45
Summary 53
References 54
Questions 57
vii
Contents
3 International classification of financial reporting 59
Contents 59
Objectives 60
3.1 Introduction 60
3.2 The nature of classification 61
3.3 Classifications by social scientists 63
3.4 Classifications in accounting 64
3.5 Extrinsic classifications 68
3.6 Intrinsic classifications: 1970s and 1980s 72
3.7 Developments related to the Nobes classification 78
3.8 Further intrinsic classification 80
3.9 Is there an Anglo-Saxon group? 80
3.10 Classification in an IFRS world 82
3.11 A synthesis of accounting classifications 83
Summary 84
References 85
Questions 89
4 International harmonisation 90
Contents 90
Objectives 90
4.1 Introduction 91
4.2 Reasons for, obstacles to and measurement of harmonisation 92
4.3 The International Accounting Standards Committee 95
4.4 Other international bodies 104
4.5 The International Accounting Standards Board 108
4.6 International harmonisation of public sector reporting 113
Summary 114
References 115
Useful websites 118
Questions 118
Part II FINANCIAL REPORTING BY LISTED GROUPS
USING IFRS OR US GAAP
5 The background to financial reporting by listed groups 123
Contents 123
Objectives 123
5.1 Introduction 124
viii
Contents
5.2 The legal and political context of international standards 125
5.3 Adoption of, and convergence with, IFRS 125
5.4 IFRS in the EU 130
5.5 IFRS/US differences 133
5.6 Convergence of IFRS and US GAAP 137
5.7 International financial analysis 139
Summary 148
References 149
Useful websites 154
Questions 154
6 IFRS in context: concepts, presentation
and revenue 155
Contents 155
Objectives 155
6.1 Introduction 156
6.2 The conceptual framework 159
6.3 IFRS requirements on presentation and accounting policies 164
6.4 Revenue and foreign currency transactions 168
6.5 Disclosures, and management commentary 171
Summary 172
References 172
Further reading 173
Useful websites 173
Questions 173
7 IFRS in context: assets and liabilities 175
Contents 175
Objectives 176
7.1 Introduction 176
7.2 Overview of accounting for tangible non-current assets 177
7.3 Lease accounting 178
7.4 Recognition of intangible assets 180
7.5 Measurement of non-current assets 181
7.6 Inventories 184
7.7 Financial instruments 185
7.8 Provisions 190
7.9 Employee benefits 195
7.10 Deferred tax 199
7.11 Synthesis on measurement of liabilities 205
Summary 206
ix