International standard of financial reporting and the risk of non-detection of the third part of the audit

استاندارد بین المللی گزارشگری مالی و ریسک عدم کشف حسابرسی قسمت سوم:

Non-discovery of the third part of the audit, we want to discuss in several parts.

3- The complexity of international financial reporting standards

In order to achieve the goal of comparability of financial statements between all companies at the global level, the International Accounting Standards Board has compiled the mentioned standards which are very complex, ambiguous and based on principles (Hassol and Makinen, 2003).

Accountants need very high skills and experience to apply international financial reporting standards (Wlam, 2004).

Hogdoorn (2006) believes that countries that have adopted international financial reporting standards have underestimated and evaluated the effects, costs and complications of these standards.

The findings of Hogdorn (2006) show that international financial reporting standards are very difficult even for experts and auditors.

Also, understanding and analyzing financial statements based on these standards will be difficult for many financial analysts and other users.

Sacher and Jane Drish-Soka (2004) state that accounting standards on financial instruments 32 and 39, employee retirement benefits 19, asset depreciation 36, hedge accounting 9, contingent assets and liabilities 3 are examples of standards Complex accounting is compiled by the International Accounting Standards Board.

The findings of Larsen and Street (2004) show that the complex nature of international financial reporting standards is one of the most important obstacles to convergence with the aforementioned standards in European countries.

The complexity of accounting standards and the familiarity of professional accountants with international financial reporting standards play a significant role in the interpretation and implementation of these standards (Chand et al., 2010).

The complexity of accounting standards has an important effect on the non-uniform implementation of accounting standards.

It is also expected that professional accountants and auditors will have to spend more time interpreting and implementing complex standards compared to simple standards.

The findings of Wong (2004) show that the complex nature of international financial reporting standards has a negative effect on the process of acceptance and implementation of these standards.

Therefore, many accountants believe that preparing financial statements based on the mentioned standards is very difficult and the structure and terms of these standards should be changed (2009).

The findings of Joshi et al. (2008) show that Bahraini auditors believe that different interpretations based on international financial reporting standards can lead to non-convergence, creating challenges and consequently increasing the risk of distortion with the importance of financial statements and finally the risk of not be audited.