.png)
Global accounting services are the accounting, reporting and tax compliance work a business needs once money, entities or people cross a border. For a US company, that usually means keeping books in more than one currency, consolidating a foreign subsidiary, pricing intercompany charges under IRS section 482 and filing information returns such as the FBAR and Form 5471 or 5472. For a CPA firm, it can also mean sending part of the work to an offshore team, which brings its own consent and security rules.
This guide explains what global accounting services cover in 2026, the US GAAP and IFRS differences that change reported numbers, the IRS and FinCEN forms that tend to come up, and what Treasury Regulation section 301.7216 requires before tax return information leaves the United States.
Providers package this work differently, so it helps to split it by area.
| Area | Typical work | Main rules involved |
|---|---|---|
| Entity bookkeeping | Local ledgers, bank reconciliations, payables and receivables in local currency | Local statutory rules, IAS 21 or ASC 830 for currency |
| Financial reporting | Group consolidation, intercompany eliminations, US GAAP or IFRS statements | US GAAP, IFRS Accounting Standards |
| Transfer pricing | Intercompany service fees, royalties, cost sharing, documentation | IRC section 482 and Treas. Reg. 1.482-1 |
| US international information returns | FBAR, Form 8938, Form 5471, Form 5472, Form 8992 | Bank Secrecy Act, IRC sections 6038, 6038A, 6038D, 951A |
| Multi-currency close | Remeasurement, translation, FX gain and loss, rate tables | IAS 21 or ASC 830 |
| Offshore delivery controls | Taxpayer consent, data access, vendor oversight | 26 CFR 301.7216, FTC Safeguards Rule |
A business with one foreign bank account may only need the FBAR line. A US group with a subsidiary in India and a sales office in the UK will touch every row. The tax side often sits with a firm that handles international taxation for CPA firms and their clients, while the bookkeeping and close can sit with a controller team or an outsourced provider. Both halves should share one chart of accounts and one intercompany schedule so the returns tie to the ledger.
US companies report under US GAAP. Most foreign subsidiaries keep statutory books under local rules, and in many countries those rules are IFRS Accounting Standards or a close local version. The IFRS Foundation states that companies in more than 140 jurisdictions are required to use IFRS when they report on their financial health. A US parent therefore often receives subsidiary numbers prepared under one framework and has to convert them to another before consolidation.
| Topic | IFRS Accounting Standards | US GAAP |
|---|---|---|
| Inventory cost formula | IAS 2 allows specific identification, FIFO or weighted average; LIFO is not permitted | LIFO is also available, and the tax LIFO conformity rule in IRC section 472 ties tax LIFO to LIFO in reports to shareholders |
| Development costs | IAS 38 capitalises development spending that meets set criteria | ASC 730 generally expenses research and development costs as incurred |
| Functional currency | IAS 21: currency of the primary economic environment | ASC 830 uses a similar functional currency concept |
| Standard setter | IASB | FASB |
The development cost row matters for software and engineering subsidiaries. An Indian or UK entity may carry capitalised development costs on its local balance sheet that a US GAAP consolidation has to reverse to expense, with the guidance in how R&D costs are treated under ASC 730 setting the US side. If the team doing the conversion is new to US rules, a refresher on US GAAP principles and how they are set is a sensible first step.
As practitioner guidance, keep a written GAAP-to-IFRS bridge for each subsidiary that lists every adjustment and who approves it.
When a US company and its foreign affiliate trade with each other, the price they set moves taxable profit between countries. Section 482 of the Internal Revenue Code gives the IRS power over this. Where two or more businesses are "owned or controlled directly or indirectly by the same interests," the Secretary "may distribute, apportion, or allocate gross income, deductions, credits, or allowances" between them to prevent evasion of taxes or to clearly reflect income.
The test the IRS applies comes from Treasury Regulation 1.482-1(b)(1): "the standard to be applied in every case is that of a taxpayer dealing at arm's length with an uncontrolled taxpayer."
For the accounting team, this means a signed intercompany agreement before the first invoice, matching intercompany entries in both entities every month, cost data that supports the chosen method, and intercompany balances reconciled at each close.
The method choice is a tax decision, usually made with an adviser, and the five OECD transfer pricing methods are the usual starting point. Intercompany balances that do not agree between the two entities are a common audit finding and weaken the transfer pricing file.
Cross-border activity creates US information returns even when no extra tax is due, and the penalties for missing them can be large.
FBAR (FinCEN Form 114). According to the IRS FBAR page, a US person, which includes a corporation or partnership, must file if it has a financial interest in or signature authority over foreign financial accounts whose aggregate value "exceeded $10,000 at any time during the calendar year reported." The FBAR is due April 15, with an automatic extension to October 15, and is filed through FinCEN's BSA E-Filing System. The guide to FBAR filing and FinCEN Form 114 covers the mechanics.
FATCA and Form 8938. Form 8938 is a separate IRS form filed with the income tax return. The IRS comparison of Form 8938 and FBAR lists specified individuals and "certain domestic corporations, partnerships, and trusts" as filers. For an unmarried individual living in the US, the threshold is foreign assets of more than $50,000 on the last day of the tax year or more than $75,000 at any time during the year. Married couples filing jointly in the US use $100,000 and $150,000.
Form 5471. The Form 5471 instructions state that the form "is used by certain U.S. persons who are officers, directors, or shareholders in certain foreign corporations." A US parent that controls a foreign subsidiary is a typical filer. The penalty is $10,000 for each annual accounting period of each foreign corporation, plus $10,000 for each 30-day period the failure continues more than 90 days after an IRS notice, with that additional penalty capped at $50,000 per failure. The foreign books therefore need to close well before the US return is due. The page on Form 5471 filing requirements for US owners of foreign corporations explains the filer categories.
Public Law 119-21, the One Big Beautiful Bill Act, renamed two international regimes for tax years beginning after December 31, 2025. The Instructions for Form 1120-IC-DISC state that "effective January 1, 2026, GILTI and FDII have been renamed Net CFC Tested Income (NCTI) and Foreign-Derived Deduction Eligible Income (FDDEI)." The calculation still runs through Form 8992, covered in GILTI and Form 8992, now NCTI.
Form 5472. This one runs the other way, for foreign ownership of US entities. Under the Form 5472 instructions, a reporting corporation includes "a 25% foreign-owned U.S. corporation (including a foreign-owned U.S. disregarded entity (DE))." A foreign person is a 25% foreign shareholder if it owns, directly or indirectly, at least 25% of the total voting power or total value of the stock. The penalty is $25,000 per failure, with further $25,000 amounts for each 30-day period once the failure continues more than 90 days after IRS notification. Foreign-owned single-member LLCs are the common miss, and the Form 5472 filing guide for foreign-owned US businesses walks through the pro forma Form 1120 they attach it to.
IAS 21 defines functional currency as "the currency of the primary economic environment in which the entity operates," and ASC 830 uses the same idea for US GAAP. Each entity keeps its books in its own functional currency. Two separate steps then happen at close.
Remeasurement deals with balances held in a currency other than the entity's functional currency. A US parent that owes a UK subsidiary a pound-denominated invoice records the payable in dollars at the transaction date rate, then restates it at the closing rate each month end. The difference goes to profit or loss as a foreign exchange gain or loss.
Translation happens on consolidation. The subsidiary's whole set of statements is converted into the parent's reporting currency, generally with assets and liabilities at the closing rate and income and expenses at average rates, and the difference sits in other comprehensive income as a cumulative translation adjustment.
A practical close sequence is to lock one rate table for the month, close each entity in its functional currency, remeasure foreign currency balances, agree intercompany balances in the transaction currency, then translate and consolidate. As practitioner guidance, agreeing intercompany balances before translation prevents most unexplained consolidation differences. For the ledger setup behind these steps, see multi-currency bookkeeping best practices. Groups with more than a handful of entities often move this work into a dedicated tool, and the trade-offs are set out in financial consolidation software benefits.
All figures here are illustrative, including the markup and exchange rates.
A Delaware software company owns 100% of a UK subsidiary that provides engineering services to the parent. The UK entity's functional currency is GBP. The intercompany agreement uses a cost-plus method with an 8% markup on total costs.
Transfer pricing fee. The UK subsidiary's annual service costs are £400,000. The fee is £400,000 × 1.08 = £432,000 for the year, invoiced monthly at £432,000 ÷ 12 = £36,000.
Remeasurement at the parent. The parent books the March invoice of £36,000 on 1 March at 1.27 USD per GBP, a payable of $45,720. At 31 March the closing rate is 1.25, so the payable is restated to £36,000 × 1.25 = $45,000. The parent records a foreign exchange gain of $45,720 − $45,000 = $720. Had the pound strengthened to 1.29, the payable would have become $46,440 and the parent would have booked a $720 loss.
Information returns. The parent controls a foreign corporation, so it files Form 5471 and includes the intercompany service charges in the related-party section. If the UK entity's bank account passed $10,000 at any point in the year, the parent generally has a financial interest in it through owning more than 50% of the subsidiary, and US officers with signature authority over the account may also need to file an FBAR, subject to the exceptions that apply.
Settling intercompany balances monthly limits how large these FX swings can grow.
Many global accounting services are delivered partly from outside the US, and CPA firms increasingly use offshore staff for tax preparation. Two sets of rules apply.
Section 7216 consent. Under 26 CFR 301.7216-3, if a tax return preparer receiving tax return information "is located outside of the United States, the taxpayer's consent under § 301.7216-3 prior to any disclosure is required." The consent "must be signed and dated by the taxpayer." For individuals filing in the Form 1040 series, a US preparer generally may not obtain consent to send the taxpayer's Social Security number offshore and "must redact or otherwise mask the taxpayer's SSN before the tax return information is disclosed outside of the United States." The exception requires an adequate data protection safeguard as defined in IRS guidance, verified in the consent request. The practical detail is in Section 7216 consent for tax return preparers.
FTC Safeguards Rule. Under 16 CFR Part 314, "an accountant or other tax preparation service that is in the business of completing income tax returns is a financial institution." The rule requires firms to "implement multi-factor authentication for any individual accessing any information system," unless a Qualified Individual approves an equivalent control in writing. It also requires firms to oversee service providers by selecting ones capable of appropriate safeguards, requiring those safeguards by contract and periodically assessing them.
For a firm reviewing an offshore provider, this translates into evidence requests: a current SOC 2 report or ISO 27001 certificate, the access model (virtual desktop, no local downloads), the MFA setup and the contract clauses that impose the safeguards. The checklist in SOC 2 and ISO 27001 vendor due diligence for accounting firms lists the documents to ask for.
What are global accounting services? Global accounting services cover bookkeeping, financial reporting and tax compliance for businesses with operations, owners or accounts in more than one country. For US companies, that typically includes multi-currency bookkeeping, US GAAP consolidation of foreign subsidiaries, transfer pricing support and international information returns such as the FBAR and Forms 5471 and 5472.
Does a US company with a foreign subsidiary need to report under IFRS? The US parent reports under US GAAP. The subsidiary may have to keep local statutory accounts under IFRS or local rules, so the group usually maintains a bridge that converts subsidiary results to US GAAP for consolidation.
When does a business have to file an FBAR? A US person, including a corporation or partnership, files an FBAR when it has a financial interest in or signature authority over foreign financial accounts whose combined value exceeded $10,000 at any time during the calendar year. It is due April 15 with an automatic extension to October 15.
What is the difference between Form 5471 and Form 5472? Form 5471 is filed by certain US persons who are officers, directors or shareholders of foreign corporations. Form 5472 is filed by 25% foreign-owned US corporations, including foreign-owned US disregarded entities, to report transactions with related parties.
Can a CPA firm send client tax returns to an offshore team? Yes, with signed and dated taxpayer consent under Treasury Regulation 301.7216-3 before any disclosure. For Form 1040 series returns, the Social Security number generally has to be redacted or masked unless the exception for adequate data protection safeguards is met.
Madras Accountancy supports US businesses and CPA firms with bookkeeping, month-end close, tax preparation and CFO advisory work, including clients with foreign entities and multi-currency books. To discuss what your cross-border accounting needs look like, contact our team.
Section 4960's 21% excise tax now reaches far more nonprofit employees. See who is a covered employee in 2026 and what changed.
The Section 45S paid family leave credit is permanent for 2026 with new options. See who qualifies, the amounts, and how to claim it.
Opportunity zones become permanent in 2027 under the One Big Beautiful Bill. See the new deferral, rural bonus, and the 2026 handoff.
