Norsk Hydro's communication to international capital markets: A blend of accounting principles
Companies operating internationally are faced with the dilemma of how to attract investors from multiple exchanges to provide capital. While each investor may prefer a report tailored to his or her country's generally accepted accounting and auditing framework, such an approach can be prohibitively expensive. The selection of International Accounting Standards Committee (IASC) guidance for reporting suffers from its lack of acceptance to date by the International Organization of Securities Commissions (IOSCO). The choice of the United States Generally Accepted Accounting Principles (U.S.GAAP) and Generally Accepted Auditing Standards (U.S. GAAS) facilitate access to large capital markers on the New York Stock Exchange, AMEX or NASDAQ but may not communicate effectively to the European or other markets. Norsk Hydro, the subject of this paper, chose to blend its domestic and U.S. accounting principles, with some episodic integration of European audit report language. The potential communication and regulatory challenges that resulted are described, as are the plethora of topics for future research, given such experimentation in financial reporting.
Year of publication: |
1997
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Authors: | Monsen, Norvald ; Wallace, Wanda A. |
Published in: |
Scandinavian Journal of Management. - Elsevier, ISSN 0956-5221. - Vol. 13.1997, 1, p. 95-112
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Publisher: |
Elsevier |
Keywords: | International capital markets civil law and common law countries accounting disclosures international accounting standards |
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