Under the United States Generally Accepted Accounting Standards (U.S. GAAP), property, plant and Equipment are reported...

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Accounting

Under the United States Generally Accepted Accounting Standards(U.S. GAAP), property, plant and Equipment are reported athistorical cost net of accumulated depreciation. These assets arewritten down to fair value when it is determined that they havebeen impaired.
Several other countries, including Australia, Brazil,England,Mexico and Singapore, permit the revaluation of property, plant andequipment to their current cost as of the balance sheet date. Theprimary argument in favor of revaluation is that the historicalcost of assets purchased ten, twenty, or more years ago is notmeaningful. A primary argument against revaluation is the lack ofobjectivity in arriving at current cost estimates,particularly forold assets that either will or cannot be replaced with similarassets or for which there are no comparable or similar assetscurrently available for purchase.
Required:1) List and discuss the 5 qualitative concept ofcomparability. In your opinion, would the financial statements ofcompanies operating in one of the foreign countries listed above becomparable to a U. S. company’s financial statements? Explain.

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Answer Answer 1 Concept of comparability Comparability is the level of standardization of accounting information that allows the financial statement of multiple organisation to be compared to each other Comparability is one of the key qualities which accounting information must possess Accounting information is comparable when accounting standards and policies are applied consistently from one period to another and from one region to another Comparative financial statements are the complete set of financial statement that an entity issues revealing information for more than one See Answer

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