The increasing globalization of business, has inevitably led toward a standardisation of International Accounting practices and financial reporting standards. The increased global uptake of IFRS financial reporting standards have been successfully implemented in more than 100 countries world wide.
In Europe, Hong Kong and Australia, securities listed companies have been using IFRS since 2005. Currently Russia and Japan are making significant moves to implement the IFRS standards across wider sections of the financial community. Since August 2006 the US Securities Exchange Commission have been courting public comment and seeking methodologies to implement IFRS in the US, replacing the US GAAP standards.
For more information of PwC's IFRS standards, differences between IFRS and GAAP, comparisons between IFRS and US GAAP as well as IFRS Convergence documents and examples Read On.
Over the past year, there has been much change in market conditions, near-term convergence is on the increase between IFRS and GAAP standards on the International stage. IFRS is affecting US and non-US companies in a number of ways as key aspects of US GAAP and IFRS continue to converge.
The Securities Exchange Commission has 2014 slated as the year of initial adoption. Despite set-backs due to the politics of change as well as structural and regulatory concerns, focus will be back on IFRS and US GAAP convergence late in 2009, early 2010.
With the increasing globalization of Capital markets and Financial Investment institutions, the US Government firmly believes in a global set of high quality standards for financial reporting. The US SEC continues assessment and comparison of IFRS adoption and convergence in relation to US GAAP, all indications are for the inevitability of national adoption of IFRS as the new standard by 2014.
More recently, the convergence between US GAAP and IFRS is to be advanced by nearly a dozen new standards proposed for the end of 2011.
The new standards for convergence are to affect the fundamental areas of debt, equity, revenue, leasing, consolidation and financial instruments. As the convergence progresses, many US companies and investors will see major changes in their financial reports. Tax policy, mergers and acquisitions, financial planning, systems requirements, compensation structures and regulation are some of the areas that will also be affected by the new convergence standards as the conversion from US GAAP to IFRS is advanced.
For more detailed information regarding differences and comparisons, or convergence between US GAAP and IFRS, consult with PricewaterhouseCoopers today.
- Relevant to this Article
- IFRS Standards
- US GAAP Standards
- IFRS Manual
- IFRS vs GAAP Differences
- GAAP vs IFRS Comparison
- IFRS to GAAP Conversion
- IFRS Convergence
- IFRS Accounting Standards
- International Accounting Standards
- International Financial Reporting Standards
The transition in global reporting
International Financial Reporting Standards (IFRS) Reporting
Financial reporting in the United States is being influenced by International Financial Reporting Standards (IFRS). IFRS reporting considerations are already impacting business decisions, and not simply through non-US subsidiaries. The SEC is considering measures that could lead to retiring US GAAP and adopting IFRS in the US. The effects of global reporting standards on US companies will accelerate over the next few years, regardless of how the SEC proceeds. Understanding IFRS and its implications is a business imperative for US companies. Take advantage of the resources that PwC has developed to increase your knowledge.
CAclubindia
