IFRS: Views Vary But Need for Planning More Certain
While the Securities and Exchange Commission (SEC) continues to review a proposed timeline, many companies realize that the changeover to IFRS is inevitable. Learn what companies can do to ensure they are adequately prepared.
October 19, 2009
Although the need for International Financial Reporting Standards (IFRS) in the United States (U.S.) continues to be debated in the business and financial communities, many believe that a transition to international accounting rules is inevitable. Increasingly, the discussion is focused more on the path to adoption and the timing of a conversion. With more than 100 countries already using IFRS, proponents believe international standards will bring greater consistency and comparability to financial reporting.
Despite the momentum toward IFRS, more than half (55%) of U.S. financial executives recently surveyed by Robert Half International said they are unsure how their companies might be affected by a transition.
While the U.S. Securities and Exchange Commission (SEC) continues to review a proposed timeline for IFRS, many companies are realizing that a changeover will be easier and less costly if they begin taking steps now to prepare for what seems to be an eventual transition. A new Robert Half report, International Financial Reporting Standards for the United States: Making the Talent Transition, proposes several preliminary actions, companies can take to be ready for IFRS:
Assess the likely impact. Every organization will be affected in different ways by IFRS, and some will find it more difficult than others to make the transition. Management needs to take a big picture view of what may have to change and when. A first step for a company is to understand the differences between current accounting and reporting policies and those required by IFRS. This information can help identify the potential need for changes to policies, processes and technology.
Although opinions vary on the need for international accounting rules, as well as on how a transition might occur, many in the financial community now believe the issue is a matter of “when,” not “if.” With this in mind, companies would be wise to begin sizing up the magnitude of the effort that will be required for their organizations. In particular, businesses that have trimmed staff in response to the recession should give careful consideration to whether they will have the resources they need to make what seems to be an inevitable transition.
For additional information, please visit www.roberthalfmr.com/IFRSUS for a copy of International Financial Reporting Standards for the United States: Making the Talent Transition.
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