U.S. VS. International Auditing Standards
4-22-08
In the last few years, the world's financial centers have grown increasingly interconnected. This increase in the global business climate can attributed in part to dramatic changes in the business and political climates, increasing global competition, the development of more market-based economies, and rapid technological improvements. With the seemingly unlimited advances in technology, it has become feasible and in most cases very necessary for companies to expand their business operations overseas. This smaller global business environment has led to numerous changes in U.S. Accounting Standards as well as International Accounting Standards. It is needless to say that foreign and domestic auditing standards would have to undergo change as well. Generally Accepted Accounting Principles are broad concepts, evolving from the actual accounting profession. Now, accountants all know that “generally accepted accounting principles” are far from being a clearly defined, comprehensive set of rules which will insure the identical accounting treatment of the same kind of transaction in every case in which it occurs. Auditing in the United States was patterned after early English practices in this countries infancy but was eventually influenced less by the English and more by professional accounting societies. The first national U.S. accounting firms were established by British accountants who brought discipline, professional training, standards, and the idea of a professional organization. In essence the majority of auditing standards date back the standards and practices of early America. With the onset of this increasingly global economy is it no surprise that these standards were inevitably headed for a change. Over the past several years the Sarbanes-Oxley Act and other events have dramatically affected the