Internationalization Of Accounting Standards For Consolidation - Japan: A Case Study

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can claim to have a uniquely correct set of rules. The United
States has the longest history of standard setting. It has the largest standard
setting organization which is characterized by high standards of professionalism.
But, even the rules of the United States exhibit compromises between different
interests of a kind which could have reasonably been decided otherwise.
Furthermore, no unanimity exists among U.S. accountants about the merits of the
precise details of the compromises that have been struck. For example, the
recent discussion memorandum on consolidation outlines three different methods
which are GAAP in the US (Beckman, 1995). No one nation has a clear right, on
the basis of existing achievements, to be regarded as predominant in accounting.
A great deal more work is needed by accountants from different countries before
we can reach the point of having a well founded basis for uniformity.

People who study differences among systems of accounting rules are ...

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is important because
capital market pressures are then brought to bear most strongly to improve the
quality of information available. The absence of detailed codes leaves
flexibility to respond to pressures. The United States, the United Kingdom,
Australia and the Netherlands are examples of countries in this category (AAA,
1995).

US consolidation policy begins with a definition of control. It is based on the
simple legal concept that the majority shareholder controls a company and that
even without a majority, a stockholder can exert significant influence. Thus,
consolidated financial statements reflect the financial position and results of
the firm as well as all subsidiaries ...

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