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Answer to Question 1
Development of accounting has a significant impact on the development of a country’s economy. Instead of leading to a lag in economic development of a nation, advancement in accounting standards lead to a meaningful contribution to economic growth of a country. Contribution of accounting development to economic development could be seen from the fact that local and international bodies of accountancy collaborate with an aim of promoting contribution to growth or success or various economies (Afterman, 1995). Much contributions of accountancy to economic development are seen from the various meetings set to establish key areas of economic development globally. An example of these meetings is a high-level meeting organized in Qatar on Accounting for Development.
In the Qatar meeting, a report was established to point out the possible capacities, global standards, integrated reporting, global standards, as well as business standards from which professional bodies could contribute to economic development through accounting standards development. in any case, it is established that well planned financial infrastructure is highly useful in aiding development of major emerging economies. The reason behind this argument is that quality financial infrastructure provides investor with a sense of acceptability in terms of high assurance level. Assurance becomes greater when resources used in economic development are accounted for (Alia, 2011). A combination of historical records through accounting methodologies and projections of future trends in econometrics or statistical economics brings in a perfect road for economic development. This implies that accounting has to be incorporated in economic development but the standards have to be developed to maintain pace with the prevailing technologies.
Answer to Question 2
Culture has a significant extent to its explanation on the relative importance of stock exchange as well as its explanation on professional accounting globally. In this case, a person has to establish the existing differences in cultures how these different cultures influence the accounting standards as well as the stock exchange regimes. Experts establish that there exists varying accounting behavioral patterns that are applied to various countries that apply them in groups. From this aspect of culture and difference in accounting practices, it is possible to group various countries in groups with respect to the accounting practices they employ (Afterman, 1995).
The culture of a country determines the accounting system to employ due to country’s regulations on the accounting standards employed (Alia, 2011). Most countries in the world employ the European cultures in various aspects of life including accounting systems. The same differences come in when pointing out that some countries employ the French culture while others employ the English culture and so on. The same happens to accounting principles and in the development of accounting. The United State has its own accounting principles but cultural influence on many countries by the American culture and economy can be used as ground for indicating that culture has a significant influence on accounting principles. Similarly, stock exchange is done in cultural and economic blocks. Trading in the stock market with China would call for some application of the Chinese culture or have the Chinese culture represented whether in language of business, economic, or accountancy behavior.............
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