Research has shown that difference in the accounting rules exist because each country has different rules; different ways in which the rules are interpreted or implemented and they are many differences at the culture of each country. At this report we are going to look out five companies which are registered at different countries. We expect to find many differences at the accounting system used at each company, the nature of the business and the culture of each country. The companies are Technip, Daiwa House Group, Nature Plc, NVR Inc and Angang and they are registered at France, Japan, UK, USA and China respectively. American and Japanese companies mostly use their national GAAP for their annual reports. European companies mostly use International Financial Reporting Standards (IFRS) which will be adopted by the Japanese companies in a few years and also Angang which is a Chinese company; there is a possibility that may use also IFRS. According to Nobes (1988) they are also major differences in the accounting rules between the USA and the UK. Due to the reports of Gray (1988) and Hofstede (1980) culture is a main factor for the different use of accounting rules. Culture can be expressed in the way how people think and what are their values, their beliefs, their attitudes, how their behaviour is affected. From the three important points that Hofstede highlighted we can understand that culture is collective, it is not observable and also it helps to differentiate individuals (everyone behaves in a different way). As we can understand different people can represent to different cultures which result to different accounting regulations. Finally we expect to see that each company may operate at different countries, they may be inserted to totally different stock exchange (some of them more than one) as they are registered at various countries.
The initial impression
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An initial impression about the reports is that all of them are organised in a professional way and they are prepared with applicable accounting standards. All five company reports have at the beginning of their annual reports the highlighted information of this year which is useful for us to see the performance of the company this year. Some of them have also the previous year highlighted information so we can do a comparison between the years. The major highlighted information is revenues, operating income per year, profit before tax, total assets and liabilities and net income per year. All of the companies used accounting ratios at their highlighted information such as Gross Margin, ROE, and Earnings per Share so the analysts and the shareholders can have more detailed information and a more clear view about company's performance.
Daiwa House Group, NVR and Technip have used graphs and charts to let us know their share performance and their latest five years highlighted information . Technip has also used charts for their orders by segment and by percentage. Also Daiwa House Group uses pictures of people with some graph lines to express their believes about the GDP, the temperature, the cell phone penetration, medical costs and the world's population trends from 1950 to 2050 at different countries. I believe they want to express from this way the worldwide radical changes and needs during the years.
At the first pages of all the annual reports we can find chairman statements and reports written by the audit committee, the senior manager and the directors of the companies. They give us information about each company's performance this year and what are the expectations of next year. The chairman of Nature Wed has written that he is pleased to have exceeded his expectations this year. Also all the chairmen and directors inform us that in preparing these financial statements, they select appropriate accounting policies, apply them consistently and they make prudent judgements and estimates. Also the information contained gives a true and fair view of the facts and that no material aspects of such information have been omitted. All the companies must have true representation of the assets, financial position and profits of the company. All this information must be knowledgeable by the shareholders of the companies so they can make right estimations.
All the companies have provided insights of the trading results of the company. Each company has announced its Consolidated Income Statement, Balance Sheet and Cash Flow. Daiwa House Group has also announced the seven year consolidated summary and its investment performance. On the other hand Technip and Angang have announced the Off-Balance Sheet Commitments and the Consolidated Statement of Changes in Shareholders' Equity. Angang except from the consolidated statements has also announced the company's financial statements.
Always on Time
Marked to Standard
Each company has prepared the financial statement with standards appropriate for their country and their company. As we can see Technip (French company) and Nature Group PLC (British company) have used IFRS for their reporting. Moreover, Angang which is a Chinese company has used IFRS and PRC Accounting Standards. But Daiwa House Group which is a Japanese Company and NVR Inc. which is an American Company have used their National GAAP for the reporting (Japanese and American GAAP respectively). It will be easier for us if the companies used the same standards of reporting so we can do comparison between them.
Except from the annual report we can find some important information at each company's website such as interim reports and full year results. Daiwa House and Nature Group have their Share Price Acquisition, Share Placing and Stock Ratings. Daiwa House has also announced a financial factbook.
Annual reports are generally written for shareholders and investors. Investors typically look at financial information contained in an annual report. From the annual report the investors can see which areas of the company are performing well and which are stable or follow a downwards trend. Also they can see whether the current debt levels are supportable or they have to be augmented. The company's income statement and balance sheet can help an investor whether to invest in its stock or not. They usually watch out the changes of the Earnings per Share from year to year and if it grows at a steady rate and the Shareholder's Equity so they can find the company's Debt-to-Equity ratio (the lower the ratio is, the stronger the company is) and it's return on equity (how well the company is using its investments).
Transparency and Disclosure keep stakeholders better informed about the way a company is being managed and governed.  It is one of those words that is assumed to have a common basis of understanding but in fact is used in different ways by different people.  Transparency and Disclosure varies among the European countries. There are many differences also between European, Asian and American terms. Disclosure on ownership information and investor rights in annual reports shows the greatest weakness.
As a criterion of the SEC, domestic US companies as NVR must create a truthful report, aiming to provide information for investors and prohibit any misrepresentation  . European companies such as Technip and Nature Group must have a true and fair view of their reports. Due to ASBE 2001, Chinese companies such as Angang are obliged by the government to prescribe to disclosure requirements.  .On the other hand, Japan has a complex system of accounting regulations, so the Japanese companies as Daiwa House provide information required by law but they don't tend to go any further  .