Payments or liabilities may also be subjected to exposure

Reference no: EM131017789

Read the case study, pp. 759-762, “H&M: The Challenges of Global Expansion and the Move to Adopt International “Financial Reporting Standards” Answer questions 19-3 and 19-4 at the end of the case study and below.

• If an investor wants to compare the financial results of The Gap, Inditex, and H&M, what difference does it make that their financial statements are prepared according to different GAAP? Would you expect there to be a big difference between U.S. GAAP as used by The Gap and IFRS as used by H&M and Inditex?

• What are the major sources of influence on H&M’s accounting standards and practices?

• What type of exposure could the CFO of H&M in the U.S. be subjected to since H&M is based in Sweden and the financial statements are prepared according to IFRS?

• Payments or liabilities may also be subjected to exposure. Explain the operational hedging strategies that may offset exposure.

Reference no: EM131017789

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