Following is the importance of accounting standards:
Standards reduce or eliminate all together confusing variations in the accounting treatment used to prepare financial statements.
With different companies following same standards, comparison of their financial policies and financial results becomes easier.
Accounting standards take care of valuing inventories, contingencies, construction contracts, fixed costs, etc. They cover all aspects of financial activities of company.
The standards help the investors for taking decision on investment.
Setting standards is useful to both the company & and the investor.