The Federal Accounting Standards Board (FASB) has control over how business is conducted here in the United States, but the need for international accounting standards is critical in today’s global economy. In 1973, Sir Henry Benson realized this and formed the International Accounting Standards Committee(IASC). The fundamental aim of the IASC has been, “ to formulate and publish, in the public interest, accounting standards to be observed in the presentation of financial statements and to promote their worldwide acceptance and observance.” (Management Accounting, p30).

The IASC has expanded rapidly. In 1973 there were nine committee members; Australia, Canada, France, Japan, Mexico, The Netherlands, United Kingdom, Ireland, United States, and West Germany. The shareholders and main users of financial institutions, rather than the members of the actual institutions, initially dominated the IASC. The membership of the IASC has expanded since 1973 with 128 members in 91 countries. “The board members have also changed along with the structure of the world economy to reflect African, Central American, and Asian influence” (Manag

The voluntary nature of the IASC has many advantages and disadvantages to individual nations around the world. One such advantage the IASC has over the FASB is the ease of use. Developing countries have turned to the IASC to develop accounting standards rather than create their own, modeled after FASB. This allows them to adhere tostandards accepted worldwide at a drastically less cost than developing their own. This also attracts new companies to conduct business on a global scale in these developing countries. This has led to the rapid increase in the membership of the IASC. The disadvantage to the IASC having control over these countries accounting practices is that many countries have adopted less tax driven regulations, thus making it harder for the developing governments to generate revenue for social programs. The disadvantage to the nature of IASC regulations is “the failure of main economic powers, such as the United Kingdom and United States, to adopt these minimal tax accounting standards. This is due in part to these countries having their own accounting standards already in place” (Financial Executive 36).

The FASB differs greatly from the IASC. This is due largely in part to the fact that all America

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