INFLUENCE OF GLOBAL COMPANIES ON THE DEVELOPMENT OF CONVERGENCE IN THE FIELD OF FINANCIAL REPORTING

Abstract

In their role as one of the main driving forces of modern globalization, global companies are increasingly influencing the development of globalization processes in the sphere of accounting. In the context of the dynamic globalization of today's world, there is a constantly growing need to achieve a higher degree of convergence in the field of financial reporting and to intensify the efforts of the international community to adopt uniform, globally applicable accounting standards. The diversity of accounting legislations and practices across countries poses a wide range of issues and challenges for global companies. The more countries in which the company conducts international business, the greater the potential for the emergence of relevant difficulties and problems related to the preparation of financial statements. The purpose of this article is to examine the impact of global companies on the development of convergence in the field of financial reporting, to outline the trends and results achieved in this area. The defined main goal is realized through the implementation of the following specific tasks: • outlining the difficulties and problems for global companies arising from the diversity of financial reporting requirements and standards applied in the countries in which they develop their activities; • presentation in a systematized form of the main differences in the preparation of financial statements of companies in different countries; • highlighting the leading forces and factors determining the development of convergence in the field of financial reporting on a global scale and placing special emphasis on the key role of global companies in these processes; • arguing the need for uniform global financial reporting standards, providing internationally comparable and useful for decision-making financial information, corresponding to the information needs of different groups of users of financial statements /including investors and other stakeholders/; • grouping the significant positive effects of adopting and implementing a single set of high-quality, globally recognized financial reporting standards into two main directions: - for global companies preparing and presenting financial statements; - for users of information from the financial statements of the global companies. In methodological terms, the application of the historical-logical approach, as well as the methods of observation, comparative analysis, synthesis, inductive and deductive methods, is of essential importance for achieving the purpose and tasks of the study. Through the use of the historical-logical approach, the relationship between the trends in the development of global companies and in the processes of convergence in the field of financial reporting worldwide is traced.