This ppt includes Discuss the Rationale for harmonization of financial reporting practice around the world.

1. DEEKSHITHA S.K.
2nd M.Com
G.F.G.C.W
HOLENARASIPURA
Under the guidance of
Sundar B. N.
Asst. Prof. & Course Co-ordinator
GFGCW, PG Studies in Commerce
Holenarasipura
Discuss the Rationale for
harmonization of financial reporting
practice around the world.

2. INTRODUCTION
MEANING
HISTORY
IMPORTANCE
NEEDS

3.  Harmonization is a
process of minimization
diversity for the
preparing of financial
reporting.
 Harmonization aims to
increase the
comparability of
accounting practices.

4. Harmonization state that it eliminates
differences between accounting practices in
various countries.

5. International harmonization of financial
reporting was first proposed in 1904.

6.  The main importance of harmonization of
reporting standards is to achieve
comparability in financial statement.
 This is even more noticeable in multinational
companies when they operate in more than
just one country
 This also serves to reduce trade barriers
among countries allowing more access to
international capital market.

7.  Reducing the cost of preparing financial
statement.
 There will be increased auditing efficiency and
money savings as companies has to use only
one set of reporting standards.

8.  Global flow of capital.
 Emergence of MNC’s.
 Internationalization of accounting profession.
 Diversities in measurement of business
income.

9. Harmonization of
accounting practices is
there fore needed to
help international
investors get
comparable financial
information.

10. Harmonization of
accounting practices
would greatly reduce
the efforts, energy and
money that are
otherwise required by
MNC’s to put in for
presenting financial
reports as per country
specific requirement.

11. Harmonization of accounting practices will help in
internationalizing the accounting professions. As
harmonization aims at reducing the disparities in
accounting practices across nations, accounting
professionals operating in one nation will find it
easy to operate in another nation as well.

12. Diversities exist in the
measurement of
business income due to
the differences in
accounting practices
across nations.

13. Over all harmonization helps to achieve
comparability in financial statement and
reducing the cost of preparing financial
statement.

14. 1. https://research-methodology.net/need-for-
hormonisation-as-a reason-for international-
differences-in-financial reporting.
2. https://www.yourarticlelibrary.com/