INTERNATIONAL ACCOUNTING

1. Why would we expect accounting measurement and disclosure practices to vary around the world? Why might we also expect clustering by accounting practices? What are the nature and the relevance of classification in the context of a study of comparative accounting systems? 3. Compare and contrast the different ways that goodwill is accounted for internationally. Evaluate the argument that U.S companies are at a competitive disadvantage compared to U.K, companies is making takeover bids as a result of differences over the treatment of goodwill. 4. What social and non financial disclosures are made by European MNEs that are a typical of U.S MNEs? Why do the Europeans have such disclosures while the U.S does not? What is the likelihood of a trend towards such disclosures by U.S multinationals?

INTERNATIONAL ECONOMICS 1. During the past 20years substantial professional effort has been devoted to testing whether the foreign has been devoted to testing whether the foreign exchange market is efficient, the question has been posted at two levels: first do agents use all available information in marking decisions? Second, does the forward exchange rate equal the markets expectation of the future spot rate? (a) Is the second of these propositions a logical consequence of the first? (b) Are these propositions testable and, if so, how can one go about testing them? Outline the problems involved in doing this. 2. Great Britain struggled with balance of payments deficits throughout the 1950s and 1960s. The general view in the popular press at the time, and to a significant degree in academic debate as well, suggested that it was necessary to impose austerity measures (tight money and domestic spending reductions) to control British imports in order to maintain balance of payments equilibrium. These efforts failed and the pound was devalued in 1967. What kind of theory of balance of payments adjustment do these views imply? Does that theory make any sense in a world of perfect capital mobility?

3. The U.S dollar appreciated very substantially during the gulf war, Depreciated back immediately after EURO comes; now it`s levelled. Why did this happen? Was this bad

for the U.S economy? Can one explain the movements in U.S real interest rates and the U.S trade balance by these movements in the real exchange rate?

4. One frequently hears argument in Canada that the country`s continuous current account deficit is bad for the health of the economy. Some argue that the country is spending beyond its means. In other countries whose current accounts are in deficit one frequently hears the argument that the deficit is unsustainable and will eventually require painful adjustments to eliminate. Frequently the proposed remedy is a tariff or other policy designed to improve the current account by reducing imports or increasing exports. Comment on these arguments. Will the imposition of a tariff improve the current account? Is it appropriate what the current account balance be zero?