Are Classifications of Accounting Outmoded Essay Example

relevant to the today’s world. e no longer live in the simple and rigid regimes that used to exist in the past. The world has really transformed into a fast, sophisticated, and developed planet where only the courageous can live. Ideas keep on changing and people are more informed and diversified in terms of operation. The cultural, economic, and geographical differences that exist among nations need to be embraced and fully recognized by investors and governments. It is necessary to shift to better ways of classifying accounts.

The world regimes are reforming, and the classification needs to find a way of accommodating these changes. There are several developments that have occurred since these classifications were drafted. Society is fast changing; new and sophisticated methods are being innovated. Keeping to the old regime of classification will be a mockery to progress.

Another reason is that the environment with which those classifications were drafted was quite simple. The economies were simple, not as complicated as they are today. The classifications, thus, suited those systems. New ideas and ways of carrying out accounting have been discovered.

The geographical differences and preferences that exist among countries mean that they cannot share similar classifications. Some countries, such as those in the African continent and Asia, have different resources as compared to those in Europe and America. These geographical disparities mean differences in development structures and resources to exploit. We can never have the same classifications and then consider the system as effective. It is, thus, necessary that new classifications are developed or the existing regimes should be critically revised to come up with those that suit the current society.

World class

companiess tend to operate on a similar front. They do understand the economic bearing of their transactions. They embrace the new sophisticated technological advancement and their policies are flexible and accommodating. Their strength lies in the constant research on the ever changing market trends. The world is a union that has to accommodate each and every institution and company.

Most of these world class companies have the best managers, accountants, auditors, and analysts; they determine the best way in which the companies do operate. It is always evident that despite them competing, they share a common goal of success. They share ideas and even hold forums to discuss the best way forward. The fact that most of them embrace a similar financial reporting system means that the research they do conduct qualifies the system they adopt.

They invest heavily before coming up with one harmonized system. It calls for great brains to be applied and research to be carried out in various fields. Their financial backing supports this. The kind of market that they deal with is also a boosting factor. They deal with informed market, and it poses a challenge to them. There are always new ideas, preferences, tastes, and desires that their clients develop on a daily basis. These companies also cover a large geographical area; hence, harmonization of their system is proven and necessary.

Accounting is the major source of success in any organization or world. It is necessary that we do respect the standards that exist but also adapt to the changing economic times in the world today. The rigid systems need to be more flexible, as the world is embracing new

and sophisticated ways and technologies. We have to change the way we classify our accounting systems in order to realize positive development.