Differences in Accounting across Borders In the United States, accounting for inventory is a difficult issue. Inventory is comprised of those items either purchased or manufactured to be resold at a profit. Numerous methods are available to account for inventory for financial reporting purposes. A very commonly used method—called LIFO (last-in, first-out)—minimizes a company’s tax obligation. In the United Kingdom, however, LIFO is not permitted for tax purposes and thus is not used very often for financial reporting. In Turkey, the use of LIFO is severely restricted, and in Russia, LIFO is a foreign term. Only in Germany, where the tax laws have been modified to allow the use of LIFO, is LIFO being adopted. Different accounting methods are available for numerous other issues in accounting. Identify some major problems associated with comparing the financial statements of companies from different countries.