Comparative Analysis of Czech Accounting with International Regulation from SMEs Perspective

Abstract

Use of harmonized accounting standards may reduce investor’suncertainty and can thus reduce the cost of capital. It can significantlyimprove the communication between business users and all theirstatements. Due to the globalization of business and internationalharmonization of financial reporting Czech Republic experiences a shiftin paradigms from historical costs accounting towards fair valuemeasurement. Paper provides an analysis between national accountinglegislature and international referential. There is also provided how theability to measure accounting harmonization can be helpful from theperspective of a globalized world. A comparative analysis betweenCzech accounting regulation and IFRS or IFRS for SMEs show thelevel of compatibility between these three sets of accounting regulation.