Worldscope Database Datatype Definitions Guide

Database Methodology
Available Format
Issue 6
Introduction to Worldscope
Worldscope is available through a variety of Thomson Financial software products,
including Thomson One products, Datastream, and MarketQA. Worldscope is also
available via direct data feed, FTP. In addition to Thomson Financial software
platforms, Worldscope is available on all the major equity applications serving the
professional finance and investment communities. Please contact your local Thomson
Financial sales office for specific information on Worldscope data delivery options and
documentation.
Diversity in International Financial Reporting
Despite recent advances by major exchanges, FASB, IASB, and other regulatory
bodies, financial accounting practices and company’s presentation of financial
accounts continue to be remarkably diverse around the world, due to differences in
the legal and tax environments in which accounts are prepared. Naturally, linguistic
and cultural diversity is reflected in financial accounts, but their form and content is
additionally influenced by less obvious factors. These include the legal and taxation
systems, transparency of corporate ownership, methods of corporate financing, the
prominence of the accounting and auditing professions, and so on. The enormous
increase in international investment flows in recent decades has highlighted the
difficulties this diversity causes, as accounts prepared in one accounting environment
are employed by users familiar with different practices. It is critically important to the
efficient operation of capital markets that accounting information be mutually
comprehensible to investors in different countries. This has been the impetus behind
attempts to harmonize accounting standards, led by organizations such as the
International Accounting Standards Committee and the Financial Accounting
Standards Board.
Worldscope’s Treatment of Accounting Differences
Worldscope is designed for the user who needs to compare the financial information
of companies from different industries and countries throughout the world. For the
reasons mentioned above, there are limitations to the comparability and thus utility of
raw data as reported in company accounts. Our analysis of financial statements from
around the world leads us to classify two main areas in which differences can arise to
impede such comparisons:
1. Valuation. Companies and accounting systems differ in the cost basis used
in financial statements; in the utilization of accruals and provisions; as well as
in the accounting methods for business combinations, depreciation, research
and development, foreign currency translation, leases, and so on.
2. Disclosure or Presentation. There can be extreme variations, even within
supposedly 'standard' accounting systems, in the terminology used in
financial statements, the definitions of individual accounting items, the format
of accounts and the depth of detail contained in the statements themselves
and in the notes to the accounts.
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