There have been frequent cries about adopting similar standards and the FASB and IASB have even cooperated in 2002 to bring the two standards closer in conformity so as to adopt them in theUS. This has many advantages in terms of allowing investors to compare companies across the world in terms of their relative performance. Since the world is becoming a global village, it is only fitting that such global standards be adopted to create harmony. However, some point to the disadvantages of the IFRS in the US.
The GAAP is seen as being specific and fairly inflexible with rigid practices while the IFRS are principle-based, allowing greater flexibility in the area of revenue recognition, etc (Epstein). Furthermore, the companies may have to incur major costs to shift to the new global standards which could be costly for many. Another point of contention is the funding behind the IASB which receives funds from a few large corporations which may leave its integrity in doubt.
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