The growth and spread of Operations Multinational Corporations

Trade today is no longer merely bilateral or regional, but has really gone global nature.
Accounting problems became evident in the import export activities, namely accounting for
currency transactions. When this becomes prevalent companies establish manufacturing and
distribution systems abroad (affiliation) or joint venture (strategic alliances). MNC (multinaional
corporation) seeking investment locations in countries that are developing. An MNC companies
are required to make reports to all investors (owners) domestically and internationally. Managers
and accountants MNC must consider many aspects in the consolidated financial statements, such
as: GAAP, socio-economic environment, inflation rates, exchange rates, taxation system, and so
forth and produce the phenomenon of global competition that is etisi global push international
accounting plays an important role and a new standard beyond the boundaries of the state
becomes a natural thing to use.
History of International Accounting
- Italy (the 14th century and 15). Used Double bookeeping Entry system.
- From the "Italian-style bookkeeping", turning to Germany to help traders Fugger era and
Hanseatic Group.
- Dutch business philosopher sharpens calculate revenue.
- French authorities are discovering the advantages and applied in the planning system and
government accountability.
- System Double Entry bookeeping affect the business interests of Britain and its colonies.
- In 1850 in Scotland formed a community public accounting profession.
- In 1870 in England was also born of a community public accounting profession.
- From the UK accounting practice spread throughout North America and the Commonwealth.
- Dutch accounting system into Indonesia.
- The accounting system found its place in French Polynesia and Africa.
- The accounting system Germany influential in Japan, Sweden, and Russia.
- The 20th Century Accounting grown in the United States and became a discipline in the
University.
- After World War II, the accounting system is growing more rapidly in the western world,
especially Germany and Japan
INTERNATIONAL ACCOUNTING DEVELOPMENTS AND CLASSIFICATION
Accounting standards and practices of each country is the result of the interaction of economic,
historical, institutional and budaya.Faktor which has a significant influence on the development
of accounting, among others:
1. Sources of funding
2. The legal system
3. Taxation
4. Institute of political and economic
5. Inflation
6. Level of economic development
7. Level of education
8. Culture

Conclusion:
This paper identifies three major stages of development of international system of accounting.
First stage: From the end of XIX century/beginning of XX century until themiddle of XX
century. This stage is characterized by inception of the idea of hav-ing an internationally
accepted set of accounting standards, adoption of legisla-tion in various countries codifying their
accounting principles, emergence of pro-fessional accounting associations, rethinking of the role
of accounting in the sys-tem of management, and internationalization of information exchange
among ac-counting professionals.
Second stage: From the middle of the XX century until the end of XX cen-tury, international
system of accounting begins to take shape. During this periodappear first international
accounting standards, and the process of harmonizationof accounting systems across countries
begins. Two international bodies IASCand IFA are formed, and their activity is gradually
recognized and supported bymajor international institutions.
Third stage: From the end of XXs century, until present day, the efforts toharmonize accounting
systems evolved into a broader concept of internationalconvergence. International accounting
standards are official accepted in manycountries and a larger portion of global economy moves
toward using IFRS. In-ternational system of accounting moves toward becoming a global system
of ac-counting

The true definition of a multinational company isnt that it manufactures in other countries,
however; the true meaning is that the business has operations in multiple countries. This
can take form in many different ways besides manufacturing. Take McDonalds for example.
They have almost 35,000 restaurants located in 119 countries around the world. This means
that not only operate the physical restaurants, they also operate supply chains to deliver the
beef and other products required to keep their locations working properly.
As you can see, operating in another country could be running a supply chain, having
physical store locations or manufacturing plants, or even providing services abroad. The
modern internet age has brought about the ability for individuals and companies to easily
communicate and start multi-national companies easier than every before in history.
With this ease of formation and establishment, there come accounting complexities and
problems. One of the main complications in dealing with multinational corporations is
accounting for and planning around foreign currency exchange rates. Most countries have
their own form of currency that fluctuates with the market and political climate in their
country. Multinational companies must keep these changes in mind when doing any type of
business abroad.

Financial statement reporting is also more complex for businesses operating in multiple
countries. FASB dictates the US dollar must be used for all domestic companies financial
statements, but other countries often require IFRS statements for their market