Accountants Now Taking the Shift to IFRS More Seriously

CFO.COmhttp://www.cfo.com/article.cfm/12734796/c_12748356?f=ThisWeekInFinance120508

Accountants Now Taking the Shift to IFRS More SeriouslyMore than half of CPAs are preparing for the U.S. move from GAAP to international rules.Sarah Johnson, CFO.com USDecember 4, 2008

More than half of U.S. accountants are preparing for widespread adoption of international financial reporting standards in this country, according to the American Institute of Certified Public Accountants. They apparently began to take the IFRS movement more seriously after the Securities and Exchange Commission proposed a timeline for transitioning — and possibly for mandating that publicly traded U.S. companies begin replacing U.S. GAAP — within the next decade.

The AICPA announced the swing in sentiment about IFRS today from an online survey the group conducted in late September and early October. The survey of 1,495 AICPA members — nearly 20 percent of whom are CFOs — shows an increase in preparedness for an IFRS switch compared to when the trade group posed the same questions of its membership in April. Then, only 41 percent had said they were getting ready for IFRS.

The SEC's roadmap brought more attention to the IFRS momentum that has been going around the world. More than 100 countries have adopted some form of IFRS, the main reason the rules' advocates say the U.S. should as well. The survey shows "CPAs are increasingly aware that international standards are coming and are starting to feel a real need to get training and gain expertise in this new area," said Arleen Thomas, AICPA senior vice president for member competency and development.

To be sure, 45 percent of the respondents said they are not preparing for IFRS. However, this number declined by 14 percentage points when the survey was last taken. Topping the CPAs' list for the top challenges for making an IFRS switch are internal training, managing workload, and updating their accounting policies.
Under SEC's proposed timeline, all publicly traded U.S. companies would be required to use IFRS within six years if the regulator votes in 2011 to push its plan forward.

© CFO Publishing Corporation 2008. All rights reserved.

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This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.