How do specific accounting theories help us understand issues relating to harmonization of accounting standard

As you read through and understand different accounting theories you quickly realize that what may seem fairly simple on the surface is actually quite complex below.

You also quickly see how difficult harmonization can be. Even though method A and method B may both be completely acceptable, migrating from one to the other may have a significant impact on some companies.

Just think of what would happen if everyone on LIFO and every other inventory method had to switch to FIFO! Complete chaos would ensue, and no one likes adjustments on their financial statements related solely to accounting policy changes.

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