Analysis of Professional Ethics of Accounting Personnel under Accounting Standards Convergence Case

1、Analysis of Professional Ethics of Accounting Personnel under Accounting Standards Convergence Case Abstract. In this paper， through the analysis of the causes and status of international accounting standards， and convergence with International Financial Reporting Standards States progress， we draw

2、that international convergence of accounting is the trend and accounting convergence is an international coordination process， whose essence is the interests of the dispute while countries must participate. In this environment， the implementation of good accounting standards and grasping the profess

3、ional ethics of the accounting staff have also become a factor in the industry that can not be ignored. Key words： Accounting Standards， Convergence， Professional Ethics 1. Introduction Accounting professional quality is the sum of profession law， career ideas and principles of professional norms fo

4、rmed by the behavior of the accounting officer conducting accounting activities and accounting relationship. At present， China， in the training of accounting personnel， often focuses only on professional knowledge and education but ignore the legal concept of literacy and accounting professional eth

5、ics education， resulting in many units of accounting information distortion， seriously affected the development of Chinas legal system and market economy. Accounting as an important part of the market economy activities， will directly affect the quality of information to the interests of the operato

6、rs， investors and the general public and other stakeholders， thereby affecting the entire national order. In the new historical period， with the internationalization and convergence of accounting standards， accounting professional ethics construction updating with times has also become a content of

7、the current accounting staff to improve the quality. 2. The causes background， development and impact of the convergence of accounting standards 2.1 Causes and status of the international accounting standards International accounting standards resulted from the integration of the world economy. Firs

8、t is the growth of international trade. With the implementation of trade liberalization policies of the West， an increasing number of countries and regions have joined the World Trade Organization， and international commodity trading increased dramatically. In international trade， both parties must

9、understand each others accounting system and financial situation of the state， and the difference between trading partners， accounting system or lack of comparability become motivation spawning international accounting organizations and the development of international accounting standards. The seco

10、nd is the rise of multinational corporations. With the concentration of capital and expansion of business activities， many large companies in Western countries turn to transnational operations. Multinational operations need to have a unified and comparable system of accounting and reporting. However

11、， due to accounting standards and practices in different countries are significant， differences between companies of multinational consolidation of internal reports， analysis and utilization will generate a lot of inconvenience. Third is the international investment interaction. In addition to multi

12、national corporations， various forms of direct or indirect cross-border investment have also been significant progress， such as through joint ventures or cooperative ventures into foreign markets or large organizations or individuals in the form of foreign investors to buy mutual funds， venture fund

13、s and insurance funds company stock. Foreign investors need to know about the companys financial position and operating results in order to assess investment risk and make appropriate investment decisions， differences in national accounting standards and practices for foreign investors to read and u

14、se financial reports cause difficulties is another motivation. Fourth is the globalization of capital markets. Stock and bond issuance are the primary means of Western corporate finance. In particular， the operation of the capital market has broken boundaries and encouraged countries to allow foreig

15、n companies licensed to market. Obviously differences in national accounting and reporting systems will lead to difficulties of enterprises entering the international market， and it is difficult to meet the needs of countries overseas capital markets and cross-border capital flows， the companys supe

16、rvisory and management. International Accounting Standards Committee IASC is established by 16 professional accountancy bodies from Australia， Canada， France， Germany， Japan， Mexico， the Netherlands， the United Kingdom， Ireland and the United States nine countries in 1973. So far， the IASB issued In

17、ternational Accounting Standards 39 IAS39， and published a series of “draft， whose members have been extended to more than 150 professional accounting bodies in more than 110 countries. IASC is headquartered in London， and its decision-making body is the Permanent Council 14 members. The purpose of

18、the International Accounting Standards Board and the International Accounting Standards Board is committed to the development and subsequent release applies to the compilation of the financial statements of accounting standards and promotes their acceptance and application worldwide. In 2001， the In

19、ternational Accounting Standards Board was established on the basis of International Accounting Standards Committee. International Accounting Standards， since 2002， has renamed as International Financial Reporting Standards. In 2003， the International Financial Reporting Standards IFRS and the draft

20、 interpretation were proposed for the first time. In November 2005， the Chinese government and the International Accounting Standards Board signed a joint statement confirming the Chinese Accounting Standards and International Financial Reporting Standards achieved substantial convergence. Although

21、Chinas accounting standards did not call China Financial Reporting Standards， the starting point and entertain the idea are consistent with international financial standards. With the efforts of IASC， IAS increasingly sophisticated and get the support and recognition of national accounting professio

22、n. 2.2 The convergence of states and International Financial Reporting Standards make advances Accounting information， as a public information resource and common international language of business， is comparable， true and fair， playing an integral role for the development of national economies and

23、the integration of the world economy. In this context， international convergence of International Financial Reporting Standards has become an inevitable trend. From global accounting convergence situation， most of the direct use of national and regional convergence model of international financial r

24、eporting standards. International Accounting Standards gets recognized. Firstly， in a lot of countries and regions such as Australia， South Africa， Singapore， the Nordic countries， accounting standards are actively moving closer to international accounting standards， and the EU is also clear that th

25、e International Accounting Standards is the foundation to coordinate differences between accounting standards of its member states. Secondly， international accounting standards are recognized by more and more countries and regions. There are more than 500 world-class companies using international ac

26、counting standards and more than 8，000 listed companies releasing their first annual report revised in accordance with International Financial Reporting Standards requires. Many securities markets e.g. Hong Kong Stock Exchange， the London Stock Exchange， etc. allow foreign listed companies to adopt

27、international accounting standards accounting statements， such as the U.S. Securities and Exchange Commission also began allowing foreign companies listed in the U.S. The preparation of financial statements is in accordance with International Accounting Standards. Many Latin American and African cou

28、ntries as well as Asian countries， including China， Japan and India also introduced a new accounting policy closer to international standards. The especially striking is the progress which the United States generally accepted accounting principles US GAAP and International Financial Reporting Standa

29、rds IFRS convergence of cooperation achieved. Thirdly， with IAS convergence， the United States makes an important step. U.S. Securities and Exchange Commission SEC in 2007 had announced that the companys future stock exchanges in the United States do not have to adopt the United States generally acc

30、ounting principles GAAP， and International Accounting Standards IAS is acceptable. Such changes of SEC cleared the obstacles for IAS in the global. Located in global economic power， with the worlds capital market norms， without U.S. participation and recognition， it is difficult to establish a singl

31、e set of International Financial Reporting Standards. The United States currently uses U.S. GAAP U.S. Financial Accounting Standards Board FASB issued by the US GAAP， which， compared with the International Financial Reporting Standards， is based on more “rules and gives more detailed guidance on the

32、 application of standards. But GAAP procedures are complicated and not easy to accept， difficult to promote. In the specific criteria， U.S. GAAP has a lot of differences with International Financial Reporting Standards. In February 2007， U.S. Financial Accounting Standards Board and the Internationa

33、l Accounting Standards Board jointly announced a new memorandum of understanding， which clearly through research， to 2021 to confirm whether through one or more of the standard-setting programs to eliminate some differences in specific areas. Fourth， other countries are also action. For example， Rus

34、sia requires， from 2004， all companies adopt International Financial Reporting Standards； Ukraine requires that from 2003 onwards， all companies adopt International Financial Reporting Standards； some CIS countries separate from the former Soviet Union， such as Estonia and Tajikistan， have also requ

35、ired the use of IFRS in the coming years. While as the worlds two economic entities， the EU and U.S. accounting standards have many differences， from the description and analysis above， we can easily see that the trend of convergence of both criteria. Driven by the European Union and the United Stat

36、es and other demonstrations capital markets， accounting standards around the world will also accelerate the convergence. 2.3 The impact of convergence of international accounting standards on China Construction of Chinas accounting standards is always in touch with establishing and improving the soc

37、ialist market economic system and promoting each other. Accounting system had emulated the former Soviet Union for a long time， which is reported to the state-owned central planning and design department. Until 1992， to meet the objective to establish a market economy， with the help of the World Ban

38、k， China began to shift to western accounting systems and developed accounting standards with international standards. This indicates the shift of China accounting mode conversion from a planned economy to a market economy， achieving the initial coordination of accounting and international accountin

39、g practices. Since 2005， based on sum up the experience of accounting reforms， learning from the International Financial Reporting Standards， we built a system of accounting standards of Chinese enterprises. Since 2007， it is into effect and encourages other companies to perform in a range of listed

40、 companies. Fundamentally， because economic globalization has entered a new period of development and Chinas market economy has entered a new stage of development， the development of accounting standards should be smooth potential and innovation converge. 2.3.1 Accounting Standards for Enterprises h

41、as achieved the international convergence in the overall framework， content and substance and has been effectively implemented China accounting has been elevated to the ranks of the international advanced level， narrowing the gap with international financial reporting standards， promoting enterprise

42、 to achieve fine management， establishing a sound internal control system， improving information systems， enhancing the quality of accounting information and corporate image and helping sustainable and healthy development of the enterprise； meanwhile， it lays the basis to achieve the Chinese account

43、ing standards with other countries or regions accounting standards. Accounting information， as a public information resource and common international language of business， is comparable， true and fair， playing an integral role for the development of national economies and the integration of the worl

44、d economy，. 2.3.2 Convergence of accounting standards and International Accounting Standards enhance the credibility of our country， providing better conditions for attracting foreign investors into the domestic capital market. In todays world， economic integration has become an important trend in t

45、he world economy. Entering the World Trade Organization has prompted Chinas economic integration into the world economic system more quickly and also let us fully understand importance of the good financial reporting system in the process of economic development. The rapid developing Chinese enterpr

46、ises have a strong desire to join the competition in the international market， hoping to financing from international capital markets. Convergence of accounting standards bring with greater transparency and mutual understanding enhanced to reduce the risk of foreign investors， creating convenience f

47、or domestic companies to attract foreign investment， but also removing a major obstacle to domestic enterprises listed overseas financing. 2.3.3 Accounting profession should actively carry out theoretical research and practical exploration. Chinese Accounting Standards and International Financial Re

48、porting Standards， there are still differences. There are still distance between Chinese Accounting Standards and International Financial Reporting Standards. Compared with some countries， we do not indicate a clear timetable for the full acceptance of International Financial Reporting Standards. In

49、 fact， this also reflects another important issue： Chinas accounting standard setters are also hovering between the “international standards and the “Chinese characteristics. Accounting Theory workers should actively carry out theoretical studies， theoretically find a way to resolve or eliminate the

50、 differences， in order to provide theoretical support to solve the national accounting standards and IFRS differences. 2.3.4 Actively involved in the international coordination of accounting standards and strive to play its role. International harmonization of accounting standards is a common trend

51、in the development of national accounting. With the integration of the global economy， the importance of information to achieve internationally comparable accounting is increasingly evident. Comparable accounting information can effectively reduce transaction costs and reduce funding costs overseas

52、enterprises to fully enhance the utilization efficiency of accounting information resources. After Chinas accession to the WTO， we must conform to this trend， and actively participate in the international coordination of accounting standards. China is now one of the IASC Member States， but also one

53、of the Intergovernmental Working Group of Experts of the United Nations International Standards of Accounting and Reporting ISAR， which provides a strong organizational guarantee for the gradual involvement of the international coordination of accounting standards. We should actively make use of the

54、se international forums to fully express our views and positions and gain trust and support from more countries， thereby accounting for the gradual establishment of China proper position. 2.3.5 Convergence of accounting standards is the first step and the equivalent is the real goal. Equivalent is e

55、qually authentic. GAAP equivalent is the Chinese enterprises in those countries or regions to implement the International Financial Reporting Standards listed， the financial statements prepared in accordance with Chinese accounting standards are not adjusted， even after adjusting adjustment made onl

56、y minimal preparation of the project description or on individual projects need not press a comprehensive IFRS conversion. Equivalent also involves auditing standards. It should also be recognized for certified public accountant issuing the audit report in accordance with the equivalent of CPA audit

57、ing standards. Achieving equivalent with other countries or regions accounting standards is beneficial in enhancing the international competitiveness of Chinese enterprises and conducive to China CPA industry bigger and stronger. Although Chinas Auditing Standards achieved international convergence

58、of accounting， but to complete the equivalent to the worlds major economic base body of accounting standards， it still needs to work for a long time. 3. Key of accounting professional ethics construction under the new situation 3.1 Firm ideals and beliefs with solid work style， and strong operationa

59、l capacity 3.1.1 Firm ideals and beliefs Accounting personnel must firmly establish the scientific Marxist world outlook， outlook on life and values， firm ideals and faith， arm themselves with scientific theory and combine the lofty ideal of communism and accounting work closely together. Faith is the core ideals of human consciousness， but also the soul of moral construction. Accounting personnel should firmly es