Predicting the Impact of IFRS

Lora Bentley

Like many things in the compliance arena, the answer to whether the transition to International Financial Reporting Standards (IFRS) in the U.S. is going to be difficult depends on the person of whom the question is asked and the context in which it is asked.


Not too long ago, Northeastern University accounting professor Charles Bame-Aldred told me that, from an education standpoint, the move from U.S. GAAP to IFRS won't be as complicated as some seem to think. He said simply:

[Academics] will read, they will prep and they will adapt to the new environment, and then they will teach IFRS.

However, he did acknowledge that it would most likely be more complicated for companies that had to retrain people, change systems and the like.


But how much will a move to IFRS affect companies that must also comply with Sarbanes-Oxley controls requirements? Jim Kim reports at that the change will be barely noticeable:

One could certainly argue that the controls check the processes that create the financial data that end up being reported. They will still do that. The resulting data will merely be repurposed for IFRS.

But he also notes not everyone agrees. Deloitte & Touche partner D.J. Gannon points out that moving from rules-based to judgment-based accounting means that internal processes and controls have to be tweaked, not just the accounting policies.

Add Comment      Leave a comment on this blog post
Jul 10, 2008 2:57 AM Nick Smith Nick Smith  says:
From the little I know about it I think IFRS is a good thing for sure. Reply

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