Adoption of International Financial Reporting Standards: Analysis of Effects and Risks and What Has Been done to Mitigate the Risks
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This research project was conducted to gain more insights on the fact that even though the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) have taken significant steps to push the U.S.toward adoptions of International Financial Reporting Standards (IFRS), there are still concerns regarding the costs versus benefits of the conversion. As a result, the paper concentrates on the effects and risks that the conversion from U.S. GAAPto IFRS will bring to four main affected parties: the regulators and standards-setting bodies, the financial statements users, the financial statements issuers, and the financial statement auditors. In addition, the paper will not address the effects and risksresultingfrom the convergence of U.S. GAAP and IFRS for a better set of standards or make any judgment whether the conversion is beneficial to the U.S.or not overall. This research project was conducted using the primary and secondary sources. Primary sources are publications from the regulators and standards-setting bodies such as the Securities and Exchange Commission(SEC), FASB, and IASB. Secondarysources are usuallyscholarlyjournal articles. Sincethe nature of this paper is informative,there is no conclusionmade from the costs-benefits analysisof the conversion.