Globalization: obstacles to harmonization of accounting

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The response addresses the queries posted in 576 words with references.

// Harmonization in accounting system is very important for smooth accounting and functioning. In this paper, we will discuss harmonization and will throw light upon obstacles to the harmonization of accounting systems. //

Harmonization of accounting systems is essential because harmonization will flow the international financial information comparability. This comparability will then be helpful in removing misunderstandings that exist today related to the reliability of foreign financial statements. It would also save time and money, which is now spent to merge the divergent financial information, when two or more reports have to abide by different national laws.

Differences in political and economic system amongst numerous countries are the pertinent obstacle that hinders the harmonization of accounting systems. Political influences disrupt the harmonization process of accounting systems and add more of confusion and cost to the process (Lew, 2005).

In addition, it is considerable that ...