Changes in External Reporting

Abstract

Globalization and cross border business transactions have encouraged the need to move towards
a single set of financial reporting standards. The introduction of International Financial
Reporting Standards (IFRS) marked a significant departure from United States (U.S.) Generally
Accepted Accounting Principles (GAAP) and most countries’ reporting requirements. With the
globalization of accounting rules, accounting convergence to IFRS may be essential to other
countries and regions in near future. This paper examines whether there are any possible impact
on companies for external reporting in Hong Kong with the adoption of IFRS. In this study, a
qualitative semi-structured interview was conducted; and the data was then analyzed. It is found
that IFRS reduces the complexity of financial reporting and improves the transparency of
financial reporting. The findings suggest that computer software is crucial and is required to be
modified and updated to facilitate the external reporting process.