UNIVERSITY OF TECHNOLOGY BAHRAIN

Salmabad, Kingdom of Bahrain

COLLEGE OF ADMINISTRATIVE AND FINANCIAL SCIENCES

1st Trimester, AY 2021-2022

BSIB 622 – International Accounting

HOMEWORK 2

COURSE CODE BSIB 622 COURSE TITLE INTERNATIONAL ACCOUNTING

SECTION TIME DAYS ROOM

STUDENT NAME ID NO.

TEACHER’S NAME Mr. Emad Sadeq DATE

TOPIC

ACTIVITY TITLE

ACTIVITY

DIRECTION &
1. Discuss the main different between IFRS and US GAAP (10 Marks)
REQUIREMENT/S
2. What are the four different methods used to translate financial statements from
one currency to another?.(10 Marks)

Rubric for 10 Marks:

9-10 = Details are fully complete and demonstrate deep understanding of content

7-8 = Answer is acceptable but lacks minor details

6-5 = Answer is responsive but not fully complete

3-4 = Major details are missing and shows low level of understanding of the content

1-2 = Answer is lacking multiple major details

0 = Question in not answered or answer given is inappropriate

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OUTPUT The IFRS vs US GAAP refers to two accounting standards and principles adhered
to by countries in the world in relation to financial reporting. More than 110
countries follow the International Financial Reporting Standards (IFRS), which
encourages uniformity in preparing financial statements.

On the other hand, the Generally Accepted Accounting Principles (GAAP) are
created by the Financial Accounting Standards Board to guide public companies
in the United States when compiling their annual financial statements.

The primary difference between the two systems is that GAAP is rules-based and
IFRS is principles-based. This disconnect manifests itself in specific details and
interpretations. Basically, IFRS guidelines provide much less overall detail than
GAAP. Consequently, the theoretical framework and principles of the IFRS leave
more room for interpretation and may often require lengthy disclosures on
financial statements. On the other hand, the consistent and intuitive principles
of IFRS are more logically sound and may possibly better represent the
economics of business transactions.

Perhaps the most notable specific difference between GAAP and IFRS involves
their treatment of inventory. IFRS rules ban the use of last-in, first-out (LIFO)
inventory accounting methods. GAAP rules allow for LIFO. Both systems allow
for the first-in, first-out method (FIFO) and the weighted average-cost method.
GAAP does not allow for inventory reversals, while IFRS permits them under
certain conditions.
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