Convergence of Accounting Standards - Assignment Example

With the market environment and the unique business packages, each decision cannot be deemed worthy on its own. This can be countered by the use of both to make the progress worthwhile. The desirability of a market will always determine the investment decision of the firms and the financial investment undertaken (May & May 2012).

            Several matters at hand render the convergence process a headache to the companies. To address these issues the decisions made by the firm management should consider the fact that the union of markets involves a joint input on different stakeholders in a business. They include investors, corporates, lenders, accountants and auditors, market data packagers, and more. Each party is an instrument in the successful convergence of a market. The main problems encountered in convergence are

• Active participation of the stakeholders in the molding of the convergence phases
• The board's decisive structures and their decisions to capture the true wants of the key stakeholders
• Lack of good protocols and strategies to give the process more positive outcomes
• Accounting standards fail to give a correct output of the comprehensive information on the finance
• Relevance

            The costs incurred by the convergence process are critical to the company’s continuity. If the convergent process is not established well, the purpose will make the process a burden to the company. Since the process is long-term, the parties need to make their priorities substantive (May & May 2012). The costs of convergence vary with the decisiveness of the administration of the company in the process. Failure to achieve good standards the firm is going to experience inefficiency, lack of trust from the parties, costly processes, and a lack of enforcement oversight. Moreover, the consistency, comprehensiveness, and clear principles will not reflect the firm’s underlying reality.