The International FinancialReporting Standards (IFRS) and the International Accounting Standards (IAS)serve as a conceptual framework for accounting for the activities ofenterprises and the preparation and presentation of financial statements fortheir reports.
Their treatments are subject to discussions with a practicalapplication nature to improve the accounting of businesses transactions, andprocesses arising from the business of the enterprises. The number of standardsare constantly changing due to re-evaluation of current standards. Newstandards are constantly being discussed or replacing old ones, which isapparent with IAS 18 and IFRS 15, so that there is unity in the comparabilityof the information received from the financial statements between differententities. This is the core principle of convergence. Convergence of accountingstandards ‘is the process of harmonisingaccounting standards issued by different regulatory bodies’ (CIMA, pg.3,2006).
Some of the main principles in accounting are for financialinformation or reporting to have clear transparency, credibility andcompatibility, and so in doing, this convergence of world-wide accountingstandards makes them easily accessible, applicable and user-friendly.