The International Accounting Standards Board (IASB) is charged with developing a set of highquality standards and encouraging their adoption globally. Standards promulgated by the IASB are called International Financial Reporting Standards (IFRS). The European Union (EU) requires statements prepared using IFRS for all companies that list on the EU stock exchanges. Although the United States does not yet accept IFRS, the SEC has indicated that it is working toward allowing international companies that list on U.S. exchanges to use IFRS for financial reporting in the United States. The differences between U.S. GAAP and IFRS are described in many different publications. For example, PricewaterhouseCoopers has a publication available for download on its website (http://www. similarities-and differences. jhtml) entitled “IFRS and U.S. GAAP: Similarities and Differences” that provides a topic-based comparison. Based on the information in this publication or others, answer the following questions about the preparation of consolidated financial statements.Requireda. Under U.S. GAAP, a two-tiered consolidation model is applied, one focused on voting rights and the second based on a party’s exposure to risks and rewards associated with the entity’s activities (the VIE model). Upon what is the IFRS framework based?b. U.S. GAAP requires a two-step process to evaluate goodwill for potential impairment (as discussed in Chapter 1). What is required by IFRS with respect to goodwill impairment?c. Under U.S. GAAP, noncontrolling interests are measured at fair value. What is required by IFRS?View Solution:
The International Accounting Standards Board IASB is charged with developing

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