| dc.description.abstract | Background and research problem discussion: The augmented globalization creates an
increased need for communication in terms of language, awareness of cultural differences and
domestic customs. However, financial communication, such as accounting and financial
results is just as important to master. There have traditionally been two different accounting
traditions in the world, the Anglo-Saxon and Continental accounting traditions. Though,
during the last few decades the Continental accounting tradition has adapted parts of the, at
present, dominating Anglo-Saxon tradition. For example do both of the two global accounting
standard-setters FASB and IASB with their accounting frameworks US GAAP and IFRS
origin from the Anglo-Saxon accounting tradition. The aim with these two standard-setters
has been to regulate accounting on an international level in order to attain harmonization
between the accounting systems of different countries. However, domestic accounting
traditions influence the interpretation of global accounting standards and make a
harmonization difficult. Accounting researchers state that increased accounting harmonization
can only become efficient when all countries interpret identical standards in the same way.
Purpose: The purpose of this thesis is to survey the basic views on Japanese accounting from
an international, in particular Swedish, perspective. Sweden has already implemented IFRS
and there is an ongoing discussion in Japan about implementing the standards of IFRS to a
greater extent. By focusing especially on the items revenues and provisions, the author wishes
to survey how economic events related to these items are interpreted in Japan. The author’s
hope with this thesis is to increase the knowledge of Japanese accounting and also to improve
Japanese and Swedish companies’ financial communication.
Method: The thesis is based on a qualitative study where in total four Japanese and two
Swedish respondents were interviewed in their respective offices in Tokyo and Yokohama,
Japan. The respondents all work for international companies in Japan and were selected
because of their knowledge, experience and insight in Japanese as well as international
accounting legislation. Secondary data such as the standards of IFRS, articles and academic
literature developed by accounting researchers have also been used.
Empirical result and conclusion:
Concerning accounting practices, Japanese and Swedish revenue recognition is most likely
similar and in congruence with IFRS. However, Japanese leasing, depreciations and
provisions for paid vacation and pensions differ between the traditional Japanese accounting
and that of IFRS. Compared to Sweden, Japanese depreciations on accounts receivables and
inventory stocks are not practiced at the same extent as in Sweden. Finally, Japan has been
influenced to a large extent by US GAAP which is more detailed than IFRS. There is
therefore a risk that an implementation of IFRS may cause confusion and extra work for
Japanese companies. The reason is that the principle-based framework involves a lot of
judgements, which Japanese companies are not used to. Japanese companies will therefore
most likely need additional external help and consultation from the accountancy/audit firms.
Finally, it would most likely be favourable for all international companies if US GAAP and
IFRS could unite into one global framework. It remains to be seen what will happen, but it is
obvious that the larger Japanese companies are interested in taking part in the work to
increase global accounting harmonization. | en |
