The worldwide standard used for accounting and preparation of companies' financial statements is the International Financial Reporting Standards (IFRS). These standards were purposefully placed in 2011 by the International Accounting Standards Board (IASB) to ensure global uniformity in creating financial statements (Jeter & Chaney, 2019) . These standards are also applicable to domestic companies. Accounting is essential in every company because it elaborates the company's financial situation to the managers, investors, government, and bank ("Understanding the Roles of Finance and Accounting in Global Competitive Advantage", 2020) . It is necessary to impose accounting standards in order to establish principles, guidelines, and timelines for the companies to adhere to when creating a financial statement. It is further necessary to unify these standards globally because it makes it easier for investors and lenders to compare two companies' financial status. The international standards also make it easier for multinational companies as only one financial statement is required.
The IFRS covers a vast area in the accounting sector and contains mandatory rules and requirements. It influences the reporting of the Statement of Financial Position/ Balance Sheet by dictating global uniformity. IFRS requires a company's financial statement to include a Statement of Comprehensive Income, featuring its profit, losses, and properties. A Statement of Changes in Equity is also paramount for a company's financial statement, and it indicates any earning changes experienced by the company over the given financial period. Finally, the Statement of Cash Flow is a requirement according to IFRS, and this explains financial transactions in the company such as investments, findings, and operational cash flows.
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Citigroup is a multinational public traded company in the United States that deals with banking and investments (Palmer & Scott, 2020) . The company's financial statement has been affected by financial operations, such as significant shifts in currency exchange rates. This change has caused the company to experience a dramatic effect on its financial statements in the form of its profits and losses. The variance of currency exchange rates may cause confusion when interpreting the financial statement, considering that only one statement is made, incorporation all the global branches. This issue might cause investors to shy away from the company and distort the company's financial stability. I believe it has reduced the number of investors, affecting the company's earnings.
References
Jeter, D., & Chaney, P. (2019). Advanced accounting (6th ed., Chapter 11; International Financial Reporting Standards). Singapore: John Wiley & Sons, Inc.
Palmer, B., & Scott, G. (2020). International Financial Reporting Standards (IFRS). Retrieved 13 January 2021, from https://www.investopedia.com/terms/i/ifrs.asp
Understanding the Roles of Finance and Accounting in Global Competitive Advantage. (2020). Retrieved 13 January 2021, from https://2012books.lardbucket.org/books/challenges-and-opportunities-in-international-business/s19-understanding-the-roles-of-fin.html
