Kasapreko Company Limited is a wholly Ghanaian-owned company with branches in Nigeria, South Africa and Germany. With relevant examples, explain the eclectic paradigm that Kasapreko might have fulfilled, before venturing international. [15 Marks]
b) Knowing that accounting and reporting laws differ widely around the world thereby posing risks for the international business, briefly explain for each how physical asset valuation (PAV) and research and
development (R&D) costs are likely to pose risks?

Answer with its Explanation:

Option A.

The company must think about the attaining of optimal function  at first place in its home country. When the company is successful in doing so, then the company must consider whether the company will be able to meet its social, cultural and economical structure. Another major issue is that whether the company's product or services will be successful as it is successful in their home country which means that the company must meet the customers needs and wants which varies country to country.

Option B.

Due to different accounting principles accepted in different jurisdictions its very difficult to consolidate. These accounting principles will also lead to  valuation discrepancies because in one country we will be valuing using a accepted method and in the other with different one.

The cost of the research and development when translated might be also affect the return of the project and poses high risk that is associated with the changes in currency which increases the vulnerability of the returns.