USA vs Malaysia
Generally Accepted Accounting Principles are mainly used in USA and they are established by the Financial Accounting Standards Board which is in the private sector. They provide guidelines on the preparation and presentation of the balance sheet, statement of comprehensive income, consolidation, revenue recognition, financial statement presentation and preparation of other financial information. The Accounting profession is regulated by the Malaysian Institute of Accountants as the main body. Other bodies include Malaysian Institute of Certified Public Accountants, and the Institute of Commercial and Industrial Accountants. Accounting standards are usually set by the Malaysian Accounting Standards Board, and the main standards used are the IFRS in the preparation and presentation of financial statements. The IFRS in Malaysia is less detailed than the USA GAAP since the GAAP sets out guidelines for its application. The USA GAAP and the Malaysia IFRS differ in their definitions of comparable concepts and leads to measurement variances and recognition differences. During disclosure, both the USA GAAP and the Malaysia IFRS requires diverse sets of notes for the financial statements and they depend on the information which is essential and the manner in which it is required (Walton, 2003). Accounting standards in both countries are involved with the IASB for guidance in their accounting.
Germany vs Australia
The accounting regulations board in this country is not based in the private sector like in the cases of USA and Malaysia. German uses the German GAAP which is more modern and has simplified and sustainable principles which are aimed at complementing the detailed IFRS. The main changes have occurred in the measurement and recognition methods, and there has been an introduction on new disclosure requirements. These changes have been carried out so as to reduce the differences between GAAP and IFRS. Accounting standards in Australia are usually set by an independent body known as the Australian Accounting Standards Board. This board ensures that financial statements are prepared in accordance with the IFRS. Australia has adopted the IFRS with some minor adjustments in accordance with the legislative environmental changes. Audits carried out in this country must be consistent with the IFRS. Australia uses the IFRS standards in reporting and hence historical costs and revaluation is allowed, whereas in Germany the GAAP is used and historical cost are used as the main means of financial information preparation but no revaluations are allowed. In the Australian IFRS, entities may part with the use of IFRS if it is deemed to be misleading, whereas in the Germany GAAP, if the principles are misleading, entities ought to prepare additional notes for disclosure purposes. The IFRS does not disclose a specified procedure in the preparation of the balance sheet, while the GAAP discloses the procedure for the preparation of the balance sheet which is in the increasing order. In both countries, the accounting standards allow for certain balance sheet items to be presented at their fair value (Nobes, 2001).
Nobes, C. (2001). Generally Accepted Accounting Principles.
Walton, P. A. (2003). International Accounting Standards. (2nd, Ed.) London.