«Comment réussir des fusions-acquisitions "cross-culturelles"?
Mergers and acquisitions continue apace in spite of an alarming failure rate and evidence that they rarely manage to benefit shareholders. Most completed takeovers damage one party:...» Document abstract
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13 word format
Language : english
business strategy
presentation
date published
21/11/2006
review : not yet assessed
level : Expert
requested 43 times
SummaryComment réussir des fusions-acquisitions "cross-culturelles"?
Mergers and acquisitions continue apace in spite of an alarming failure rate and evidence that they rarely manage to benefit shareholders. Most completed takeovers damage one party: the company making the acquisition. Many studies made have all reached the same conclusion: around 65% of takeovers harm the interests of the acquiring company’s shareholders. They do, however, often reward the shareholders of the acquired company.
Indeed, most of failed mergers suffer from poor implementation, and in half of the cases, senior management fails to take into account the different cultures of the companies involved. Melding corporate culture takes time, which senior management does not have after a merger. Most mergers are based on the idea of "let's increase revenues", but the company must have an efficient management team to succeed in that process. The nature of the problem is not so much that there is open warfare between the two sides. It is that the cultures do not meld quickly enough to take advantage of the opportunities. In the meantime, the marketplace has moved on.
Many consultants refer to how little time companies spend, before a merger, thinking about whether their organisations are compatible. The benefits of mergers are usually couched in financial or commercial terms: cost-savings can be made or the two sides have complementary businesses that will allow them to increase revenues. Mergers basically consist in compatibility, which means agreeing whose values will prevail and who will be the dominant partner. So it is no surprise that managers, as well as journalists, reach for marriage metaphors in describing them. We are convinced that defining in advance what success means for the merging companies is already part of their success to come, part of the durability of their union.
We are all interested in mergers because, statistically, an executive has nowadays 100% chance to be, at least once in his professional life, concerned by a merger, the firm he works for being acquired or acquiring another one. Studying Daimler-Chrysler, Renault-Nissan and Air-France-KLM, and confronting those three examples to different theories about mergers, has enabled us to understand and work on the deep and intrinsic relationship which exists between mergers and corporate culture in every firm, especially as these three M&As are different in many ways: they have either worked out, failed, or not been implemented yet.
We consider corporate culture as a whole of convictions, values, ways of behaving, assumptions and beliefs that are shared by employees, workers and managers of a firm, and define its running. The elements which differentiate corporate cultures are:
Power distance, individualism v. collectivism, uncertainty avoidance (career stability, formal rules, no tolerance for deviant ideas/behaviours, expertise…), masculinity…
(Geert HOFSTEDE: “Culture’s consequences: International differences in work-related values”, 1980)
Basically, it is a "social contract" inside a firm, consisting of rules of behaviour and a cultural code. Thanks to this common code created by the founder of the firm and enriched by the successive generations, employees have the feeling they belong to a special group or organisation: they share a common vision of it. Moreover, they have a part to play in the elaboration and the evolution of these unwritten conventions. The more involved they feel in the firm, the better they will work and participate in the creation of profits. Thus, the attention managers give to the respect of corporate culture and to the necessity of its restructuring when negotiating and implementing a merger is vital. Indeed, without such an attention, the merger has very little chance to be successful, partly due to a strong negative reaction of its employees.
One must never underestimate the importance of psychological criteria when dealing with a merger, be it in small or big companies. Communication is determining between all the levels of the hierarchy, because fears and expectations of employees cannot be left apart without jeopardising the productivity of the merging firms. If so, the merger would be a failure and definitely useless. This leads us to emphasise the fact that a merger is a melting pot of technical as well as human skills, which make the success or the difficulties of the two merging firms. Corporate culture is therefore a competitive advantage for a firm, along with its technical performances. This is why it must be considered as a priority in the implementation of a merger.
The question we chose to work on is that of the skills necessary to “manage” an M&A. We have envisaged the word “to manage” in both of its meanings, in order words as “to succeed” and “to lead”, thus privileging the point of view of a board of directors confronted to a cross-cultural M&A, in the shape of recommendations concerning each stage of a merger: ASSESSMENT, NEGOTIATION and IMPLEMENTATION.
Mergers and acquisitions continue apace in spite of an alarming failure rate and evidence that they rarely manage to benefit shareholders. Most completed takeovers damage one party: the company making the acquisition. Many studies made have all reached the same conclusion: around 65% of takeovers harm the interests of the acquiring company’s shareholders. They do, however, often reward the shareholders of the acquired company.
Indeed, most of failed mergers suffer from poor implementation, and in half of the cases, senior management fails to take into account the different cultures of the companies involved. Melding corporate culture takes time, which senior management does not have after a merger. Most mergers are based on the idea of "let's increase revenues", but the company must have an efficient management team to succeed in that process. The nature of the problem is not so much that there is open warfare between the two sides. It is that the cultures do not meld quickly enough to take advantage of the opportunities. In the meantime, the marketplace has moved on.
Many consultants refer to how little time companies spend, before a merger, thinking about whether their organisations are compatible. The benefits of mergers are usually couched in financial or commercial terms: cost-savings can be made or the two sides have complementary businesses that will allow them to increase revenues. Mergers basically consist in compatibility, which means agreeing whose values will prevail and who will be the dominant partner. So it is no surprise that managers, as well as journalists, reach for marriage metaphors in describing them. We are convinced that defining in advance what success means for the merging companies is already part of their success to come, part of the durability of their union.
We are all interested in mergers because, statistically, an executive has nowadays 100% chance to be, at least once in his professional life, concerned by a merger, the firm he works for being acquired or acquiring another one. Studying Daimler-Chrysler, Renault-Nissan and Air-France-KLM, and confronting those three examples to different theories about mergers, has enabled us to understand and work on the deep and intrinsic relationship which exists between mergers and corporate culture in every firm, especially as these three M&As are different in many ways: they have either worked out, failed, or not been implemented yet.
We consider corporate culture as a whole of convictions, values, ways of behaving, assumptions and beliefs that are shared by employees, workers and managers of a firm, and define its running. The elements which differentiate corporate cultures are:
Power distance, individualism v. collectivism, uncertainty avoidance (career stability, formal rules, no tolerance for deviant ideas/behaviours, expertise…), masculinity…
(Geert HOFSTEDE: “Culture’s consequences: International differences in work-related values”, 1980)
Basically, it is a "social contract" inside a firm, consisting of rules of behaviour and a cultural code. Thanks to this common code created by the founder of the firm and enriched by the successive generations, employees have the feeling they belong to a special group or organisation: they share a common vision of it. Moreover, they have a part to play in the elaboration and the evolution of these unwritten conventions. The more involved they feel in the firm, the better they will work and participate in the creation of profits. Thus, the attention managers give to the respect of corporate culture and to the necessity of its restructuring when negotiating and implementing a merger is vital. Indeed, without such an attention, the merger has very little chance to be successful, partly due to a strong negative reaction of its employees.
One must never underestimate the importance of psychological criteria when dealing with a merger, be it in small or big companies. Communication is determining between all the levels of the hierarchy, because fears and expectations of employees cannot be left apart without jeopardising the productivity of the merging firms. If so, the merger would be a failure and definitely useless. This leads us to emphasise the fact that a merger is a melting pot of technical as well as human skills, which make the success or the difficulties of the two merging firms. Corporate culture is therefore a competitive advantage for a firm, along with its technical performances. This is why it must be considered as a priority in the implementation of a merger.
The question we chose to work on is that of the skills necessary to “manage” an M&A. We have envisaged the word “to manage” in both of its meanings, in order words as “to succeed” and “to lead”, thus privileging the point of view of a board of directors confronted to a cross-cultural M&A, in the shape of recommendations concerning each stage of a merger: ASSESSMENT, NEGOTIATION and IMPLEMENTATION.
Table of Contents- Assessment stage.
- What do we mean by ´assessment´?.
- Critical notions to be envisaged during assessment.
- Negotiation stage.
- What is the point of negotiating ?.
- Implementation stage.
- Why is the implementation phase important ?.
- What does this phase require ?.
«Despite rapid changes in the global environment and competitive landscape, advertising remains being perceived as the main marketing communication tool. Though it can be disputable, but not in terms of mass audience reach and therefore expensiveness...» Document abstract
$9.95
12 word format
Language : english
marketing
presentation
date published
03/11/2006
review : not yet assessed
level : Advanced
requested 117 times
SummaryDespite rapid changes in the global environment and competitive landscape, advertising remains being perceived as the main marketing communication tool. Though it can be disputable, but not in terms of mass audience reach and therefore expensiveness (PICTON, David & BRODERICK, Amanda 2005, p.595).
The fact is that considerable part of company’s promotional budgets is spent on advertising (Ibid.).
Hence, advertising can not be solely creative and original, what is more important it should successfully fulfill its functions and achieve objectives have been set irrelative of whether it was produced for consumer or business-to-business product (ROTFELD, Herbert 2002).
Through writing this report the author will try to:
➢ Highlight factors responsible for making an advertising effective;
➢ Indicate differences between consumer and B-2-B markets able to influence on the advertising effectiveness;
➢ Apply achieved theoretical results to examine The Danon Actimel advertising.
According to the specificity of exact work primary research methods have not been used and secondary data was considered to be sufficient to carry out analysis in an appropriate way.
To warranty information’s provided objectivity and accordance with contemporary market’s circumstances, periodicals and websites were utilized along with marketing textbooks.
The fact is that considerable part of company’s promotional budgets is spent on advertising (Ibid.).
Hence, advertising can not be solely creative and original, what is more important it should successfully fulfill its functions and achieve objectives have been set irrelative of whether it was produced for consumer or business-to-business product (ROTFELD, Herbert 2002).
Through writing this report the author will try to:
➢ Highlight factors responsible for making an advertising effective;
➢ Indicate differences between consumer and B-2-B markets able to influence on the advertising effectiveness;
➢ Apply achieved theoretical results to examine The Danon Actimel advertising.
According to the specificity of exact work primary research methods have not been used and secondary data was considered to be sufficient to carry out analysis in an appropriate way.
To warranty information’s provided objectivity and accordance with contemporary market’s circumstances, periodicals and websites were utilized along with marketing textbooks.
Table of Contents- Key Factors of Advertising Effectiveness
- Models Overview
- Advertising Plan
- Differences between B-2-C and B-2-B Advertising
- Actimel: Components of Effective Advertising
- Executive Summary
Les internautes ont également acheté "Networking within tourism destinations hinders innovation and freedom of choice." Critically discuss this statement
«Tourism, like so many modern industries, is essentially an assembly process. In few situations does one organisation or company control all the components, or all the stages and decision-making processes in the creation and delivery of the tourism...» Document abstract
$7.95
8 word format
Language : english
business strategy
presentation
date published
11/10/2006
review : not yet assessed
level : Expert
requested 2 times
SummaryTourism, like so many modern industries, is essentially an assembly process. In few situations does one organisation or company control all the components, or all the stages and decision-making processes in the creation and delivery of the tourism product.
That is why in most industrial sectors and particularly in the tourism industry, it has become commonplace for organisations to collaborate in order to achieve the goals they have established for themselves.
“A key reason for the growing interest in collaboration in tourism is the belief that organizations and destination areas may be able to gain competitive advantage by bringing together and sharing their combined knowledge, expertise, capital and other resources” (Kotler et al., 1999b).
Does networking within tourism destinations hinder innovation and freedom of choice?
First it is necessary to define the key words in the question above, the key words being, tourism destinations, innovation and freedom of choice. Before talking about tourism networking, I will show that tourism destinations do not hinder innovation and freedom of choice. Finally I will present my research on networking in tourism, based on the fact that it is essential for a tourism destination in particular for SME’s. I will also discuss the idea that it hinders innovation and freedom of choice by comparing the potential problems and benefits of networking.
That is why in most industrial sectors and particularly in the tourism industry, it has become commonplace for organisations to collaborate in order to achieve the goals they have established for themselves.
“A key reason for the growing interest in collaboration in tourism is the belief that organizations and destination areas may be able to gain competitive advantage by bringing together and sharing their combined knowledge, expertise, capital and other resources” (Kotler et al., 1999b).
Does networking within tourism destinations hinder innovation and freedom of choice?
First it is necessary to define the key words in the question above, the key words being, tourism destinations, innovation and freedom of choice. Before talking about tourism networking, I will show that tourism destinations do not hinder innovation and freedom of choice. Finally I will present my research on networking in tourism, based on the fact that it is essential for a tourism destination in particular for SME’s. I will also discuss the idea that it hinders innovation and freedom of choice by comparing the potential problems and benefits of networking.
Table of Contents- Definition
- A destination
- Innovation in tourism
- Freedom of choice
- Tourism destinations do not hinder innovation and freedom of choice
- The attractions
- The access
- Amenities and ancillary services
- The local people
- Networking within tourism destinations
- What is a network
- Potential problems against innovation and freedom of choice of tourism networking
- Potential benefits against innovation and freedom of choice of tourism networking
«Jewelry sector is the largest in the luxury goods industry with global retail sales amounting to $150 billion.
US.representing the biggest market of $ 43 billion.
Within the luxury industry, the following jewelers are the major players:
Tiffany,...» Document abstract
$9.95
44 slides .ppt
Language : english
marketing
case study
date published
28/09/2006
review : not yet assessed
level : Expert
requested 2 times
SummaryJewelry sector is the largest in the luxury goods industry with global retail sales amounting to $150 billion.
US.representing the biggest market of $ 43 billion.
Within the luxury industry, the following jewelers are the major players:
Tiffany, Cartier, under parent company Richemont, Bvlgari (can be pronounced Bulgari).
Both brands started with producing Jewelry, and the products are diversified. Tiffany puts its major focus on Jewelry and introduced its products concentratively. Bvlgari introduced its products in a more constant way, and plans to expand to non-Jewelry sectors.
Both brands have strong control of their distribution channels. Tiffany has only tiny of wholesales and tries to expand direct marketing. Bvlgari uses franchisees and intends to open shops in tourist places.
Both brands present on almost the same world market. Tiffany puts more efforts on the US and Japanese mkts and its image is stronger there. Bvlgari focus more on the European mkt, and more geographically diversified.
Recommendations:
Maintain market share in the US and Japan, however relocate operation risks in terms of store location
International presence, especially retail identity in emerging market.
Keep develop the opportunity and revenue generated by direct market.
Maintain the current product lines, however more research has to be done to truly understand its affluent consumers and to quantify their perceptions of the Tiffany brand and products.
Table of Contents- Tiffany vs. Bvulgari.
- The structure.
- Jewelry industry.
- History.
- Tiffany's strategies in distribution and manufacture.
- Key strategies.
- Tiffany's net earning.
- Risk factors.
- Strategy in terms of manufacturing.
- Comparison between Tiffany and Bvlgari. Recommendations.
- Comparison of brand identities.
- Comparison of international presences.
- Compare sales among brands.
- Tiffany's positioning.
- Tiffany Swot analysis.
- Bvlgari Swot analysis.
Les internautes ont également acheté «The brand history: at the beginning :
Sergio Rossi learned the art of shoe making by working beside his father.
He established his own brand in the 50’s at San Mauro Pascoli.
He created shoes for urban and sophisticated customers.
Demand...» Document abstract
$9.95
51 slides .ppt
Language : english
marketing
case study
date published
28/09/2006
review : not yet assessed
level : Expert
requested 4 times
SummaryThe brand history: at the beginning :
Sergio Rossi learned the art of shoe making by working beside his father.
He established his own brand in the 50’s at San Mauro Pascoli.
He created shoes for urban and sophisticated customers.
Demand increased during the 60’s and 70’s while Italy’s quality shoe market exploded.
International development :
In the 80’s Sergio Rossi’s success allowed him to go beyond his own borders.
He expanded his distribution network in Europe by opening his DOS in Milan, Florence, Rome, Düsseldorf and Paris.
In the 90’s he opened independent stores in Osaka and Hong Kong and his first sales outlet in the US in New York.
Shoe collections for some of the most visible creators: Gianni Versace, Azzedine Alaïa and Dolce&Gabbana.
Perspective to enter into the market of mainland China :
Opportunities :
Competition between shoemakers in Mainland China is not as intensive as in HK because the market is not highly diversified and saturated, especially for high-end footwear. Even though Ferragamo, Jimmy Choo and other traditional prestigious shoemakers entered this market several years ago, they still haven’t constructed a framework of high competitive advantages. For other luxury multi-product brands as LV, Gucci, Prada, they still focus on their core businesses
Challenges :
Immature and complicated market (sales and logistics, culture and training, location); long-term on return of investment; no brand image; sales staff quality
On conclusion, this market is promising but not promised; it takes more time to enter.
Table of Contents- The brand history: at the beginning.
- International development.
- Joining the Gucci Group.
- Partnership with the Gucci Group: a new step forward.
- About Gucci Group.
- Brands' acquisition from 1999.
- Sergio Rossi and the competition.
- Sergio Rossi distribution policy.
- Latest and future openings .
- Sergio Rossi's new global store concept.
- Communication policy.
- Global analysis of luxury market in China.
- The size of target market.
- China's retail market.
- Luxury brands chase emerging countries.
- Defects of China's luxury market.
- Luxury shopping malls in shanghai.
- Three on the Bund.
- Dragon Attack-Cartier .
- Dragon Attack-Armani.
- Consumer behavior differences.
- Distribution, marketing and communication strategic plan.
Les internautes ont également acheté «Our Mission :
“To provide Hong Kong customers with the “fun, fashion and feel-good experience” that granted its success in the Uk while modeling and adapting the Harvey Nichols’ brand values to the Hong Kong’s environment.”
Our Strategy...» Document abstract
$9.95
42 slides .ppt
Language : english
marketing
case study
date published
28/09/2006
review : not yet assessed
level : Expert
requested 1 times
SummaryOur Mission :
“To provide Hong Kong customers with the “fun, fashion and feel-good experience” that granted its success in the Uk while modeling and adapting the Harvey Nichols’ brand values to the Hong Kong’s environment.”
Our Strategy :
Complementary product selection to enhance the Landmark’s product offering.
Product selection that differentiates Harvey Nichols from its potential competitors.
Consistency with Harvey Nichols traditional store layout.
Consistency with the needs and wants of the target costumers.
Choice of the right product lines and departments to be represented.
Ideal Positionning:
To keep high luxury while stressing on the British image of Harvey Nichols.
Table of Contents- Retail market China.
- Opportunities for China.
- Difficulties in China.
- Hong Kong Land- Main shopping areas.
- Landmark.
- Landmark in Hong Kong.
- Chinese vs. HK customer.
- The strategic positionning of the new Harvey Nichols.
- Strategic positionning.
- Commercial strategy.
- Harvey Nichols in HK.
- Our mission.
- Our strategy .
- Store Layout.
- Our priorities: departments.
- Services.
- Events.
«International distribution focus :
Coach: mainly focus on US & JP, with limited presence in other countries, especially in Europe.
Polo: more interested in global expansion in Euro and Asia (GCR, JP, Korea, Russia, etc).
Factory outlet...» Document abstract
$9.95
55 slides .ppt
Language : english
marketing
case study
date published
28/09/2006
review : not yet assessed
level : Expert
requested 3 times
SummaryInternational distribution focus :
Coach: mainly focus on US & JP, with limited presence in other countries, especially in Europe.
Polo: more interested in global expansion in Euro and Asia (GCR, JP, Korea, Russia, etc).
Factory outlet penetration :
Coach: more selections of product and locations.
Polo: limited assortments and locations.
Brand strategy :
Coach: Single brand.
Polo: Multi brands. More vertical extension than Coach.
Brand positioning :
Coach: Modern, fashionable. More accessible and affordable.
Polo: Classic, elegant. At higher end segments.
Design philosophy :
Coach: Use young, well-known designers for seasonal collections.
Polo: Focus on in-house designers.
Table of Contents- An American story.
- The Coach Brand.
- Business philosophy.
- Distribution business model.
- Excellence formula.
- Swot.
- Competitions.
- The ´win-win´ combination.
- Will the excellence continue ?.
- Geographical swot.
- Polo Ralph Lauren Brand.
- Major milestones of Polo Group development.
- Brand extension.
- Distribution strategy.
- Distribution business model.
- Retail strategy.
- Retail financial figures.
- Comparison of Distribution Coach and Ralph Lauren- Difference.
- Comparison of business strategy.
- Opportunities and challenges.
- Swot- distribution and strategies.
- Retail segment.
Les internautes ont également acheté «Since the existing markets of Calvin Klein and Tommy Hilfiger were saturated, both companies have been actively seeking to expand through new markets, via distribution as well new target populations.
American spirit is core to the lifestyle...» Document abstract
$9.95
60 slides .ppt
Language : english
marketing
case study
date published
28/09/2006
review : not yet assessed
level : Expert
requested 2 times
SummarySince the existing markets of Calvin Klein and Tommy Hilfiger were saturated, both companies have been actively seeking to expand through new markets, via distribution as well new target populations.
American spirit is core to the lifestyle aesthetic as well as business style of both companies. Unlike traditional European luxury houses, which keep control over manufacturing and distribution to stress heritage and maximize true prestige, Calvin Klein and Tommy Hilfiger compromise control and exclusivity to maximize revenues.
Table of Contents- Calvin Klein
- Tommy Hilfiger
- Brand Comparison
Les internautes ont également acheté «"Elegance is not about being noticed, but about being remembered."
(Giorgio Armani).
Giorgio Armani was born 11 July 1934 in Piacenza, Italy.
Worked in a department store, La Rinascente, as a window dresser.
A designer in the well-known fashion...» Document abstract
$9.95
36 slides .ppt
Language : english
marketing
case study
date published
28/09/2006
review : not yet assessed
level : Expert
requested 13 times
Summary"Elegance is not about being noticed, but about being remembered."
(Giorgio Armani).
Giorgio Armani was born 11 July 1934 in Piacenza, Italy.
Worked in a department store, La Rinascente, as a window dresser.
A designer in the well-known fashion house Nino Cerruti.
In 1974, with assistance of his partner, Sergio Galeotti, he established his own company.
One of the world's most recognizable brands, and the sole owner of the $7 billion label.
Leveraging its strong brand equity in the fashion apparel market, Giorgio Armani has ventured into other related categories like eyewear, watches and cosmetics.
Giorgio Armani Occhiali, leg end body wear, cosmetics, profumi, gioielli, orologi.
But Armani has not stopped at just these product categories: He has extended the brand into multiple other categories such as Armani Casa (up-market furniture), Armani-branded Dolci (confectionary), and Armani-branded Fiori (Flowers).
In addition to this wide portfolio of brands, Armani has also entered the services market: restaurants, nightclubs and caffè under the Armani Brand. He also recently struck a deal with Dubai-based property group Emaar to come up with a chain of 14 Armani branded hotels and resorts by 2011.
Table of Contents- Company history.
- The Armani business model.
- The strategy.
- 3 staple principles.
- Brand stretching strategy: a lifestyle brand.
- Brand extension.
- Brand extension: the philosophy.
- Product portfolio.
- Brand portfolio.
- Financial soundness.
- Vertical integration.
- Geographical coverage.
- Armani's specificities.
- The Armani distribution strategy.
- Evolution of the business model.
- Distribution strategy.
- Retail.
- International distribution.
- Wholesale.
- Licensing.
- International distribution strategy.
- SWOT analysis.
«There is no doubt that Anglo-Saxon accounting can be distinguished from accounting in continental Europe, Asia, Latin American, and many other parts of the world. It is practiced not only in the United States and United Kingdom, but also to an...» Document abstract
$9.95
26 word format
Language : english
accounting
presentation
date published
28/09/2006
review : not yet assessed
level : General public
requested 1 times
SummaryThere is no doubt that Anglo-Saxon accounting can be distinguished from accounting in continental Europe, Asia, Latin American, and many other parts of the world. It is practiced not only in the United States and United Kingdom, but also to an important extent in countries where, for example, the United Kingdom has had a major colonial influence, such as in Australia, Canada, Hong Kong, India, Ireland, Kenya, Malaysia, New Zealand, Nigeria, Singapore, and South Africa. Anglo-Saxon accounting tends to be relatively optimistic and transparent compared to the Germanic and Latin countries, as well as Japan.
In many Ways, Accounting in the United Kingdom is very similar as might be expected given the importance or the historical and investment connections between the two countries. Just as the language and legal system were exported from the United Kingdom to the United States, so were the founding fathers of U.S accounting, including pioneers such as Arthur Young (a Glasgow University graduate of the 1880s). Nevertheless, the United States has adapted rather than adopted the United Kingdom accounting tradition. Indeed, the more recent historical and environmental circumstances of the United States have given rise to some significant distinguishing features.
The securities markets are the dominant influence on accounting regulation in the United States. Dealings in securities and investor protection are regulated and enforced at the federal government level under the Securities Act of 1933 and the Securities Exchange Act of 1934, which were passed in response to the stock market crash of 1929 and subsequent financial crises.
The Securities and Exchange Commission (SEC) was established with the legal authority to enforce the securities laws and also to formulate as well as enforce accounting standards. However, the SEC recognizes as authoritative the “Generally Accepted accounting Principles“ (GAAP) embodied in standards issued by an independent Financial Accounting Standards Board (FASB), witch was established in 1973 following criticism of the standard setting procedures of the American Institute of Certified Public Accountants, thus the standard setting role has been delegated to the FASB with the SEC acting in only a supervisory capacity unless it deems it necessary to intervene, which it has done on only rare occasions (e.g. With respect to oil and gas accounting). Corporations are required to follow EASB standards; otherwise the SEC will refuse registration and hence trading in their securities. It should be noted that only listed corporations (a minority of U.S. corporations) are required to comply with the very detailed regulations imposed by the SEC for investor protection purposes.
The FASB has a very open approach to standard setting known as operating in the “sunshine”. All meetings are open to the public and a variety of opinions sought in an elaborate “due-process” in an effort to ensure that the public interest is properly served. In order to help formulate new standards and improve existing ones; the FASB has developed an explicit conceptual framework of objectives and qualitative characteristics of financial reporting in its series of statements of financial accounting concepts.
The Fast’s pronouncements on accounting practice are issued as “Statements of Financial Accounting Standards” (SFAS). More Than 100 of these had been issued by 1991. Taken overall, the FASB Standards are quite detailed and voluminous compared to U.K standards, for example, this suggest that while the United Stats is similar in many ways to the United Kingdom and Other Anglo-Saxon countries, it is unique in having perhaps the most comprehensive system of accounting regulations in the world, at least so far as securities markets are concerned.
In many Ways, Accounting in the United Kingdom is very similar as might be expected given the importance or the historical and investment connections between the two countries. Just as the language and legal system were exported from the United Kingdom to the United States, so were the founding fathers of U.S accounting, including pioneers such as Arthur Young (a Glasgow University graduate of the 1880s). Nevertheless, the United States has adapted rather than adopted the United Kingdom accounting tradition. Indeed, the more recent historical and environmental circumstances of the United States have given rise to some significant distinguishing features.
The securities markets are the dominant influence on accounting regulation in the United States. Dealings in securities and investor protection are regulated and enforced at the federal government level under the Securities Act of 1933 and the Securities Exchange Act of 1934, which were passed in response to the stock market crash of 1929 and subsequent financial crises.
The Securities and Exchange Commission (SEC) was established with the legal authority to enforce the securities laws and also to formulate as well as enforce accounting standards. However, the SEC recognizes as authoritative the “Generally Accepted accounting Principles“ (GAAP) embodied in standards issued by an independent Financial Accounting Standards Board (FASB), witch was established in 1973 following criticism of the standard setting procedures of the American Institute of Certified Public Accountants, thus the standard setting role has been delegated to the FASB with the SEC acting in only a supervisory capacity unless it deems it necessary to intervene, which it has done on only rare occasions (e.g. With respect to oil and gas accounting). Corporations are required to follow EASB standards; otherwise the SEC will refuse registration and hence trading in their securities. It should be noted that only listed corporations (a minority of U.S. corporations) are required to comply with the very detailed regulations imposed by the SEC for investor protection purposes.
The FASB has a very open approach to standard setting known as operating in the “sunshine”. All meetings are open to the public and a variety of opinions sought in an elaborate “due-process” in an effort to ensure that the public interest is properly served. In order to help formulate new standards and improve existing ones; the FASB has developed an explicit conceptual framework of objectives and qualitative characteristics of financial reporting in its series of statements of financial accounting concepts.
The Fast’s pronouncements on accounting practice are issued as “Statements of Financial Accounting Standards” (SFAS). More Than 100 of these had been issued by 1991. Taken overall, the FASB Standards are quite detailed and voluminous compared to U.K standards, for example, this suggest that while the United Stats is similar in many ways to the United Kingdom and Other Anglo-Saxon countries, it is unique in having perhaps the most comprehensive system of accounting regulations in the world, at least so far as securities markets are concerned.
Table of Contents- Anglo-saxon accounting
- United states
- United kingdom
- Nordic accounting
- The netherlands
- Sweden
- Germanic accounting
- Germany
- Switzerland
- Latin accounting
- France
- Italy
- Asian accounting
- Japan
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