Milestone One - International Accounting

ACC 680 Final Project Guidelines and Rubric

Overview There seems to be a general misconception that accountants working in many organizations—such as a local CPA firm or an organization that is not publicly traded—will not be impacted by the concerns of international accounting. Globalization, however, continues to shrink the global market into a seemingly smaller playing field, making connections from businesses of any size and location to other businesses even more likely and more crucial. Companies that may not have felt the impact of globalization and these accounting concerns in the past are likely to be feeling them now. This course will approach international accounting concepts and dilemmas critically, examining the differences and impact of conducting business globally.

The purpose of the final project in this course is to foster this critical thinking in regard to key concepts in international accounting. The project will explore the impact of diversity in accounting practices, the differences and impact of generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS), and how international rules and regulations influence business practices.

In this assignment, you will demonstrate your mastery of the following course outcomes:

 Evaluate diversity in accounting practices for their impact on the effectiveness of financial accounting and reporting in a global economy

 Differentiate between generally accepted accounting principles and International Financial Reporting Standards as they apply to the transparency and effectiveness of financial statements

 Assess the implications of the United States converging with International Financial Reporting Standards by critically evaluating the impact it will have on financial reporting in a global economy

 Analyze the process of international financial statement analysis for its impact on the decision-making process in a multinational organization

 Interpret how foreign currency rates impact financial statement creation in accordance with applicable rules and regulations

 Examine the implications of variances in international tax laws on organizational strategy under generally accepted accounting principles and International Financial Reporting Standards reporting requirements

Prompt For this project, consider this scenario: you have worked very hard and have just earned a promotion at Quality CPA firm. As part of your new responsibilities, you will be advising an influential client on their international aspirations. Their business has been booming and they are seriously considering expanding their operation overseas. They are concerned about the political and financial risks of such an undertaking.

You will build a multimedia presentation (utilizing audio, if possible, with speaker notes to elaborate) that addresses the upper management of this company. You will choose a country other than the United States. This country will be presented as a potential destination for the company, although other countries can be included, as the global market is the focus. The presentation must explore the company’s potential expansion into the chosen country, the global market in general, and how the expansion will impact their operations.

Specifically, the following critical elements must be addressed:

I. Global Business: For this part of the assessment, convey to your audience the differences between accounting practices around the world.

A. Explain the influence of environmental issues of diversity on accounting practices. B. Evaluate the impact of the chosen country’s culture on their financial accounting standards.

1. What accounting principles could help inform your response (i.e., Hofstede’s dimension of culture, Gray’s accounting values, etc.)? C. Evaluate the impact of potential issues on business operations that may arise when conducting accounting business in the chosen country.

II. Accounting Standards: For this part of the project, explain to your audience the differences between generally accepted accounting principles (GAAP)

and International Financial Reporting Standards (IFRS) and the implications in converging with IFRS. A. Differentiate between the reporting requirements for GAAP and IFRS. B. Given these differences, determine which reporting standard(s) would be most appropriate for your company, given their desire to expand

globally and why they would be appropriate. C. Distinguish the disclosure requirements for GAAP and IFRS. D. Given these differences, determine which disclosure standard(s) would be most appropriate for your company given their desire to expand

globally, and explain why they would be appropriate. E. Assess the impact that the convergence of GAAP and IFRS will have on investors of companies in the United States and in the global market. F. Assess the impact that the convergence of GAAP and IFRS will have on firms similar to your company. In other words, how will its effect on

investors and the global market affect the company? G. Explain the role of International Accounting Standards Board (IASB) in harmonization. How is the board created? In other words, how does this

support convergence? 1. What are your thoughts on how this may or may not impact your company?

III. Global Market: For this part of the project, you will explain to your audience the impact that expanding into the global market will have on your

decision-making tools and processes. A. Analyze the potential issues in financial statement analysis when conducting business in the chosen country. B. Make recommendations on how your company could avoid these financial statement analysis issues. C. Analyze the international financial statement analysis process for potential benefits. In other words, what would be the benefits of international

financial statement analysis despite the potential issues?

IV. International Business Practice: For this part of the project, you will explain the implications of variances in international tax laws on organizational

strategy. You will also explain how foreign currency transactions impact financial statement creation in accordance with GAAP. A. Explain how foreign currency exchange rates will impact the income potential or financial risk of the company given their expansion into the

global market. 1. What will this mean for the income and risk of the company? 2. How will foreign currency exchange rates impact financial statements?

B. Make recommendations for tools or strategies the company could use to help mitigate these risks.

C. Explain the benefits of international tax laws or treaties if your company expanded to your chosen country. D. Provide examples of possible tax incentives offered by countries to attract investments or promote exports. E. Explain the tax disadvantages that should be considered by your company and your investors when expanding globally.

Milestone One: Global Business

Milestones

In Module Two, you will prepare a draft of the section of your final presentation that covers the topic of global business. Your work should include an emphasis on diversity, culture, and potential issues with conducting accounting business internationally. This milestone will be graded with the Milestone One Rubric.

Milestone Two: Accounting Standards In Module Five, you will prepare a draft of the section of your final presentation that covers the topic of accounting standards. Your work should review the different reporting requirements for GAAP and IFRS. From there, you will make a decision about which reporting standard is best for your company as well as which disclosure standards would be most appropriate. You will assess the convergence of GAAP and IFRS, including an explanation of the harmonization role provided by IASB. Finally, you will provide an analysis on how IASB impacts your company. This milestone will be graded with the Milestone Two Rubric.

Milestone Three: Global Market In Module Seven, you will prepare a draft of the section of your final presentation that covers the topic of the global market. Specifically, you will analyze potential issues in financial statement analysis in your company’s country of choice and make a recommendation on how to avoid these issues. You will also weigh the benefits of the international financial statement analysis process. This milestone will be graded with the Milestone Three Rubric.

Milestone Four: International Business Practice In Module Eight, you will prepare a draft of section of your final presentation that covers the topic of international business practices. You will include an explanation of how foreign currency change rates will impact the company and make recommendations on how to mitigate these risks. You will also touch on the key points of international tax laws, the benefits of tax incentives, and potential tax disadvantages. This milestone will be graded with the Milestone Four Rubric.

Final Project Submission: International Accounting Presentation In Module Nine, implement the recommended changes or improvements from the three milestone assignments and submit the final project fully completed. It should include all previous sections. You will include an explanation of how foreign currency change rates will impact the company and make recommendations on how to mitigate these risks. You will also touch on the key points of international tax laws, the benefits of tax incentives, and potential tax disadvantages. This submission will be graded with the Final Project Rubric (see the next page).

Deliverables

Milestone Deliverable Module Due Grading One Global Business Two Graded separately; Milestone One Rubric

Two Accounting Standards Five Graded separately; Milestone Two Rubric

Three Global Market Seven Graded separately; Milestone Three Rubric

Four International Business Practice Eight Graded separately; Milestone Four Rubric

Final Submission: International Accounting Presentation

Nine Graded separately; Final Project Rubric

Final Project Rubric Guidelines for Submission: Your multimedia presentation must be accompanied by speaker notes and may contain audio if you wish.

Instructor Feedback: This activity uses an integrated rubric in Blackboard. Students can view instructor feedback in the Grade Center. For more information, review these instructions.

Critical Elements Exemplary (100%) Proficient (90%) Needs Improvement (70%) Not Evident (0%) Value

Global Business: Diversity

Meets “Proficient” criteria and demonstrates a nuanced understanding of the underlying issues in the environmental factors

Explains the influence of environmental issues of diversity on accounting practices

Explains the influence of environmental issues of diversity on accounting practices but explanation lacks depth or detail

Does not explain the influence of environmental issues of diversity on accounting practices

5.4

Global Business: Culture

Meets “Proficient” criteria and supports evaluation with accounting principles

Evaluates the impact of culture of the chosen country on financial accounting standards around the world

Evaluates the impact of culture of the chosen country on financial accounting standards around the world but evaluation is cursory

Does not evaluate the impact of culture of the chosen country on financial accounting standards around the world

5.4

Global Business: Potential Issues

Meets “Proficient” criteria and provides keen insight into the potential issues that may arise when conducting business in the chosen country

Evaluates the impact of potential issues on business operations that may arise when conducting business in the chosen country

Evaluates the impact of potential issues that may arise when conducting business in the chosen country but evaluation is cursory

Does not evaluate the impact of potential issues that may arise when conducting business in the chosen country

5.4

Accounting Standards: Reporting

Meets “Proficient” criteria and demonstrates a nuanced understanding of the differences between reporting requirements in GAAP and IFRS

Distinguishes between the reporting requirements for GAAP and IFRS

Distinguishes between the reporting requirements for GAAP and IFRS but differentiation is inaccurate or lacks detail

Does not distinguish between the reporting requirements for GAAP and IFRS

5.4

Accounting Standards: Reporting

Standard(s)

Meets “Proficient” criteria and provides keen insight into which standards would be most appropriate for the company in the given scenario

Determines which reporting standards would be most appropriate for the company in the given scenario

Determines which reporting standards would be most appropriate for the company in the given scenario but determination lacks depth or detail

Does not determine which reporting standards would be most appropriate for the company in the given scenario

5.4

Accounting Standards: Disclosure

Meets “Proficient” criteria and demonstrates a nuanced understanding of the differences between disclosure requirements in GAAP and IFRS

Distinguishes between the disclosure requirements for GAAP and IFRS

Distinguishes between the disclosure requirements for GAAP and IFRS but differentiation is inaccurate or lacks detail

Does not distinguish between the disclosure requirements for GAAP and IFRS

5.4

Accounting Standards: Disclosure

Standard(s)

Meets “Proficient” criteria and provides keen insight in which standards would be most appropriate for the company in the given scenario

Determines which disclosure standards would be most appropriate for the company in the given scenario

Determines which disclosure standards would be most appropriate for the company in the given scenario but determination lacks depth or detail

Does not determine which disclosure standards would be most appropriate for the company in the given scenario

5.4

Accounting Standards: Investors

Meets “Proficient” criteria and provides keen insight into impact of convergence of GAAP and IFRS on investors in the United States and in the global market

Assesses the impact that convergence of GAAP and IFRS will have on investors in the United States and in the global market

Assesses the impact that convergence of GAAP and IFRS will have on investors in the United States and in the global market but assessment is cursory

Does not assess the impact that convergence of GAAP and IFRS will have on investors in the United States and in the global market

5.4

Accounting Standards: Firms

Meets “Proficient” criteria and makes connections between how the impact of convergence on investors and the global market will also inform the impact of convergence on firms similar to the company in the scenario

Assesses the impact that convergence of GAAP and IFRS will have on firms similar to the company in the scenario

Assesses the impact that convergence of GAAP and IFRS will have on firms similar to the company in the scenario but assessment is cursory

Does not assess the impact that convergence of GAAP and IFRS will have on firms similar to the company in the scenario

5.4

Accounting Standards:

Harmonization

Meets “Proficient” criteria and offers opinions on how IASB and harmonization may or may not impact the company in the scenario

Explains the role of IASB in harmonization

Explains the role of IASB in harmonization but explanation lacks depth or detail

Does not explain the role of IASB in harmonization

5.4

Global Market: Potential Issues

Meets “Proficient” criteria and provides keen insight into how the process of reviewing financial statements may influence the company in the scenario

Analyzes the process of reviewing financial statements for potentials issues when expanding into the global market

Analyzes the process of reviewing financial statements for potentials issues when expanding into the global market but analysis lacks depth or detail

Does not analyze the process of reviewing financial statements for potentials issues when expanding into the global market

5.4

Global Market: Recommendations

Meets “Proficient” criteria and communicates recommendations in a professional manner that is also easy for the client to understand

Makes recommendations for how the company in the scenario could avoid issues of international financial statement analysis

Makes recommendations for how the company in the scenario could avoid issues of international financial statement analysis but recommendations are inappropriate or lack detail

Does not make recommendations for how the company in the scenario could avoid issues of international financial statement analysis

5.4

Global Market: Potential Benefits

Meets “Proficient” criteria and provides keen insight into the analysis of the international financial statement review process for potential benefits

Analyzes the international financial statement review process for potential benefits

Analyzes the international financial statement review process for potential benefits but analysis lacks depth or detail

Does not analyze the international financial statement review process for potential benefits

5.4

International Business Practice: Currency Exchange

Rates

Meets “Proficient” criteria and illustrates how foreign currency exchange rates will impact the creation and analysis of financial statements

Explains how foreign currency exchange rates will impact income potential and financial risk for the company in the given scenario

Explains how foreign currency exchange rates will impact income potential and financial risk for the company in the given scenario but explanation lacks depth or detail

Does not explain how foreign currency exchange rates will impact income potential and financial risk for the company in the given scenario

5.4

International Business Practice: Recommendations

Meets “Proficient” criteria and communicates recommendations in a professional manner that is also easy for the client to understand

Makes recommendations for tools or strategies the company in the scenario could use to help mitigate these risks

Makes recommendations for tools or strategies the company in the scenario could use to help mitigate these risks but recommendations are inappropriate or lack detail

Does not make recommendations for tools or strategies the company in the scenario could use to help mitigate these risks

5.4

International

Business Practice: Benefits

Meets “Proficient” criteria and demonstrates a keen insight into the benefits of international tax laws or treaties that would benefit the company

Explains the benefits of international tax laws or treaties for the company in chosen country

Explains the benefits of international tax laws or treaties for the company in the chosen country but explanation lacks depth or detail

Does not explain the benefits of international tax laws or treaties for the company in the chosen country

5.4

International Business Practice:

Tax Incentives

Meets “Proficient” criteria and examples demonstrate a keen insight into the tax incentives offered by countries to attract companies

Provides examples of possible tax incentives offered by countries to attract companies

Provides examples of possible tax incentives offered by countries to attract companies but examples provided are inappropriate or vague

Does not provide examples of possible tax incentives offered by countries to attract companies

5.4

International Business Practice: Tax Disadvantages

Meets “Proficient” criteria and provides keen insight into the disadvantages that should be considered

Explains the tax disadvantages that should be considered by the company in the scenario

Explain the tax disadvantages that should be considered by the company in the scenario but explanation lacks depth or detail

Does not explain the tax disadvantages that should be considered by the company in the scenario

5.4

Articulation of Response

Submission is free of errors related to citations, grammar, spelling, syntax, and organization and is presented in a professional and easy-to-read format

Submission has no major errors related to citations, grammar, spelling, syntax, or organization

Submission has major errors related to citations, grammar, spelling, syntax, or organization that negatively impact readability and articulation of main ideas

Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas

2.8

Total 100%