Research has shown that difference in the accounting regulations exist because each state has different regulations ; different ways in which the regulations are interpreted or implemented and they are many differences at the civilization of each state. At this study we are traveling to look out five companies which are registered at different states. We expect to happen many differences at the accounting system used at each company, the nature of the concern and the civilization of each state. The companies are Technip, Daiwa House Group, Nature Plc, NVR Inc and Angang and they are registered at France, Japan, UK, USA and China severally. American and Nipponese companies largely use their national GAAP for their one-year studies. European companies largely use International Financial Reporting Standards ( IFRS ) which will be adopted by the Nipponese companies in a few old ages and besides Angang which is a Chinese company ; there is a possibility that may utilize besides IFRS. Harmonizing to Nobes ( 1988 ) they are besides major differences in the accounting regulations between the USA and the UK. Due to the studies of Gray ( 1988 ) and Hofstede ( 1980 ) civilization is a chief factor for the different usage of accounting regulations. Culture can be expressed in the manner how people think and what are their values, their beliefs, their attitudes, how their behavior is affected. From the three of import points that Hofstede highlighted we can understand that civilization is corporate, it is non discernible and besides it helps to distinguish persons ( everyone behaves in a different manner ) . As we can understand different people can stand for to different civilizations which result to different accounting ordinances. Finally we expect to see that each company may run at different states, they may be inserted to wholly different stock exchange ( some of them more than one ) as they are registered at assorted states.
The initial feeling
An initial feeling about the studies is that all of them are organised in a professional manner and they are prepared with applicable accounting criterions. All five company studies have at the beginning of their one-year studies the highlighted information of this twelvemonth which is utile for us to see the public presentation of the company this twelvemonth. Some of them have besides the old twelvemonth highlighted information so we can make a comparing between the old ages. The major highlighted information is grosss, runing income per twelvemonth, net income before revenue enhancement, entire assets and liabilities and net income per twelvemonth. All of the companies used accounting ratios at their highlighted information such as Gross Margin, ROE, and Net incomes per Share so the analysts and the stockholders can hold more elaborate information and a more clear position about company ‘s public presentation.
Daiwa House Group, NVR and Technip have used graphs and charts to allow us cognize their portion public presentation and their latest five old ages highlighted information. Technip has besides used charts for their orders by section and by per centum. Besides Daiwa House Group uses images of people with some graph lines to show their believes about the GDP, the temperature, the cell phone incursion, medical costs and the universe ‘s population tendencies from 1950 to 2050 at different states. I believe they want to show from this manner the world-wide extremist alterations and demands during the old ages.
At the first pages of all the one-year studies we can happen president statements and studies written by the audit commission, the senior director and the managers of the companies. They give us information about each company ‘s public presentation this twelvemonth and what are the outlooks of following twelvemonth. The president of Nature Wed has written that he is pleased to hold exceeded his outlooks this twelvemonth. Besides all the presidents and managers inform us that in fixing these fiscal statements, they select appropriate accounting policies, use them systematically and they make prudent opinions and estimations. Besides the information contained gives a true and just position of the facts and that no material facets of such information have been omitted. All the companies must hold true representation of the assets, fiscal place and net incomes of the company. All this information must be knowing by the stockholders of the companies so they can do right appraisals.
All the companies have provided penetrations of the trading consequences of the company. Each company has announced its Amalgamate Income Statement, Balance Sheet and Cash Flow. Daiwa House Group has besides announced the seven twelvemonth consolidated drumhead and its investing public presentation. On the other manus Technip and Angang have announced the Off-Balance Sheet Commitments and the Consolidated Statement of Changes in Shareholders ‘ Equity. Angang except from the amalgamate statements has besides announced the company ‘s fiscal statements.
Each company has prepared the fiscal statement with criterions appropriate for their state and their company. As we can see Technip ( Gallic company ) and Nature Group PLC ( British company ) have used IFRS for their coverage. Furthermore, Angang which is a Chinese company has used IFRS and PRC Accounting Standards. But Daiwa House Group which is a Nipponese Company and NVR Inc. which is an American Company have used their National GAAP for the coverage ( Nipponese and American GAAP severally ) . It will be easier for us if the companies used the same criterions of describing so we can make comparing between them.
Except from the one-year study we can happen some of import information at each company ‘s web site such as interim studies and full twelvemonth consequences. Daiwa House and Nature Group have their Share Price Acquisition, Share Placing and Stock Ratings. Daiwa House has besides announced a fiscal factbook.
Annual studies are by and large written for stockholders and investors. Investors typically look at fiscal information contained in an one-year study. From the one-year study the investors can see which countries of the company are executing good and which are stable or follow a downwards tendency. Besides they can see whether the current debt degrees are bearable or they have to be augmented. The company ‘s income statement and balance sheet can assist an investor whether to put in its stock or non. They normally watch out the alterations of the Net incomes per Share from twelvemonth to twelvemonth and if it grows at a steady rate and the Shareholder ‘s Equity so they can happen the company ‘s Debt-to-Equity ratio ( the lower the ratio is, the stronger the company is ) and it ‘s return on equity ( how good the company is utilizing its investings ) .
Transparency and Disclosure keep stakeholders better informed about the manner a company is being managed and governed.[ 1 ]It is one of those words that is assumed to hold a common footing of understanding but in fact is used in different ways by different people.[ 2 ]Transparency and Disclosure varies among the European states. There are many differences besides between European, Asian and American footings. Disclosure on ownership information and investor rights in one-year studies shows the greatest failing.
As a standard of the SEC, domestic US companies as NVR must make a true study, taking to supply information for investors and forbid any deceit[ 3 ]. European companies such as Technip and Nature Group must hold a true and just position of their studies. Due to ASBE 2001, Chinese companies such as Angang are obliged by the authorities to order to disclosure demands.[ 4 ].On the other manus, Japan has a complex system of accounting ordinances, so the Nipponese companies as Daiwa House supply information required by jurisprudence but they do n’t be given to travel any farther[ 5 ].