Getting Burned Using Outsourced Overseas Accounting Services

Dec. 21, 2012 - PRLog -- There are differences between countries in the way accounting principles are applied. GAAP (Generally Accepted Accounting Principles) is used in the USA, while many other countries use IFRS (International Financial Reporting Standards).

Time differences between countries can sometimes make receiving documents or statements problematical; this is particularly true if accounting functions are outsourced to countries that have a 12-16 hour time difference (even the minimal time difference of 3 hours between the west coast and east coast of the USA sometimes causes these types of problems).

Other countries are not bound by USA taxation laws nor are they required to obey Internal Revenue Service (IRS) dictates.

GAAP is rules based while IFRS is principles based. IFRS gives a more realistic picture of the economics of a transaction than does GAAP.  For example, GAAP values intangible assets at fair market value, while IFRS only recognizes the value of an intangible asset if there is a future economic benefit and measured reliability.

See more reasons not to use overseas accounting services at http://www.speedycpa.com/virtual-cpa/outsourcing-accounti...

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