This case introduces the concept of convergence between International Financial Reporting Standards (IFRS) and U.S. Generally Accepted Accounting Principles (GAAP). The scenario involves a securities analyst's evaluation of Novartis AG's financial performance under IFRS and U.S. GAAP, and provides an opportunity to examine the issues giving rise to differences under the two sets of standards. Based on the company's 20‐F disclosure, the case uses the reconciliation footnotes to recast the company's IFRS financial statements to U.S. GAAP. The analytical skill of adjusting financial statements is useful beyond the IFRS‐to‐U.S. GAAP context.
Research Article| November 01 2007
Making the Right Comparisons: Novartis AG
Issues in Accounting Education (2007) 22 (4): 721–733.
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Elaine Henry, Ya‐Wen Yang; Making the Right Comparisons: Novartis AG. Issues in Accounting Education 1 November 2007; 22 (4): 721–733. doi: https://doi.org/10.2308/iace.2007.22.4.721
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