THE DEVELOPMENT OF INTERNATIONAL FINANCIAL REPORTING STANDARDS: ORIGINATION TO PRESENT DAY

Peter Aghimien
Khalid Bashnini
King Abdulaziz University
ABSTRACT
As the world markets and businesses converge, a single set of standards for the reporting
of financial statements is becoming inevitable. International Financial Reporting Standards
(IFRS) have been developed and growing ever since the International Accounting Standards
Committee was formed in 1973. Their goal is to create a set of principles based standards that
transcend any one nation’s set of standards in order to be equitable to all. Over 100 countries
currently permit or require the use of IFRS with most of the remaining world having a time-frame
in place to adopt the standards. However, many of the countries are still in a transition phase. The
United States is the only major world power that has not adopted or set a date to adopt IFRS. The
country is slowly moving towards the major change in domestic accounting, which is by most,
considered inevitable. Yet, the lack of a mandatory adoption date, worries about U.S.
preparedness for the switch, and overall skepticism of IFRS are significant obstacles that first
must be overcome. The purpose of this study is to discuss the development of IFRS, from its
beginning to the present day.