What the two major types of legal systems used in the world

Assignment Help Accounting Basics

Reference no: EM132023130

Part A - Questions

Q1. What accounting issues arise for a company as a result of engaging in international trade (imports and exports)?

Q2. What financial reporting issues arise as a result of making a foreign direct investment?

Q3. What would be the advantages of having a single set of accounting standards used worldwide?

Q4. Astra Zeneca PLC, based in the United Kingdom, and Abbott Laboratories, based in the United States, are two of the largest pharmaceutical firms in the world. The following information was provided in each company's 2012 annual report.

Astra Zeneca 2012 Annual Report
(£ in millions)	Revenues	Noncurrent Assets
United Kingdom	£8,782	£2,743
Continental Europe	11,264	3,673
The Americas	15,822	25,767
Asia, Africa, Australasia	6,534	803
	£42,402	£32,986

Abbott Laboratories 2012 Annual Report
($ in millions)	Net Sales to External Customer	Long-Term Assets
United Sates	$16,784	$15,244
Japan	2,441	1,169
Germany	1,740	6,173
The Netherlands	1,883	532
Italy	1,127	222
Canada	1,253	352
France	1,167	220
Spain	942	314
United Kingdom	1,049	1,345
India	933	3,467
All other Countries	10,555	6,874
Consolidated	$39,874	$35,912

Required: Calculate an index of multinationality based upon the geographical distribution of Sales and Assets (employee information is not available) to determine which of these two companies is more multinational.

Part B - Questions

Q1. What are the two major types of legal systems used in the world? How does the type of legal system affect accounting?

Q2. What are the major problems caused by worldwide accounting diversity for a multinational corporation?

Q3. What are the major problems caused by worldwide accounting diversity for international portfolio investment?

Q4. How are the Anglo and less developed Latin cultural areas expected to differ with respect to the accounting values of conservatism and secrecy?

Q5. According to Nobes, what are the two most important factors influencing differences in accounting systems across countries?

Q6. What are the different ways in which financial statements differ across countries?

Reference no: EM132023130

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