Accountants at multinational firms possess expertise in financial, managerial, cost and tax accounting as accountants who work for firms doing business solely in the United States. However, their roles take on additional challenges as they must be aware of the legal, economic, ethical and cultural considerations of each country their work involves, such as taxation differences, reporting standards, business practices and approaches to risk assessment.
If your career aspirations include working for global firms, earning a specialized Master of Business Administration (MBA) in accounting with courses focusing on international accounting will provide the knowledge and cross-cultural competencies you need to advance in the global business environment.
Develop Cross-Cultural Accounting Competencies
These skills are necessary for working effectively in multinational companies that operate in diverse cultural environments. Some of the key cross-cultural accounting competencies include:
- Cultural awareness: Understanding the cultural nuances of different countries and regions is crucial for accountants working in multinational companies. This includes knowledge of local customs, traditions and business practices, as well as an appreciation for cultural differences.
- Cross-cultural communication: Effective communication is critical for accountants working in multinational companies. This includes not only language skills but also an ability to communicate effectively with people from different cultural backgrounds and adapt to different communication styles.
- Flexibility: Adapting to different cultural environments is an important cross-cultural accounting competency. This includes working effectively in different time zones, traveling to different countries and adapting to different work cultures.
- Ethical awareness: Accountants working in multinational companies may encounter ethical dilemmas that differ from those in their home country. Understanding ethical principles and cultural norms in different countries is essential for navigating these situations.
Take on a More Complex Set of Accounting Challenges
An international accountant has various roles and responsibilities which extend beyond an accountant operating solely within domestic borders, which include:
- Ensure compliance: Accounting regulations and rules differ by country of operation.
- Verify the accuracy of financial reports: Each country has its own relevant governing body with unique requirements.
- Conduct research: International accounts spend considerable time in this area in order to recommend viable international business opportunities.
- Master taxation: Each country has its own evolving tax and accounting principles.
- Prepare financial reports: Reporting is based on compatible accounting principles for the company’s management and stakeholders to aid decision-making.
- Supervise financial transactions: Layers of complexity are added to transactions involving foreign companies, such as mergers and acquisitions.
Work Within International Accounting Standards
International accountants must learn to work with the global standards put forth by the International Accounting Standards Board (IASB), known as the International Financial Reporting Standards (IFRS). These differ substantially from the U.S. Generally Accepted Accounting Principles (GAAP) in several ways:
- Legal authority: IFRS is issued by the International Accounting Standards Board (IASB), while GAAP is issued by the Financial Accounting Standards Board (FASB) in the United States. GAAP has the force of law in the U.S., while IFRS does not.
- Focus: GAAP is primarily used in the United States, while IFRS is used in many countries around the world. IFRS has a global focus, while GAAP has a national focus.
- Principles vs. rules: GAAP tends to be more rule-based, with specific guidelines and procedures to follow, while IFRS tends to be more principle-based, providing broad guidelines and leaving the implementation to individual judgment.
- Treatment of specific topics: There are also some specific nuances in the treatment of certain accounting topics, such as the treatment of inventory, intangible assets and research and development expenses that differentiate the two sets of standards.
- Presentation: The format of financial statements can also differ under IFRS and GAAP. For example, IFRS requires a statement of comprehensive income, while GAAP requires a statement of income.
A Curriculum to Prepare You for International Business and Accounting
Students learn to provide solutions to accounting issues and challenges on both a global and domestic scale in Eastern Washington University’s online MBA with an Accounting Concentration program. Throughout the concentration courses, students will examine international accounting issues, challenges and opportunities faced by multinational firms. These courses include International Forensics Accounting, International Financial Management, International Investments and Leading in an Intersectional World.
By developing these competencies, along with core MBA business competencies, graduates can prepare to work effectively in diverse jobs and cultural environments and contribute to the success of an organization in the global business environment.