SEC soliciting public comment on role of IFRS

The Securities and Exchange Commission has voted unanimously to publish a Concept Release for public comment on allowing US issuers, including investment companies, to prepare their financial statements using International Financial Reporting Standards (IFRS) as published by the International Accounting Standards Board. (View the SEC Press Release).

India announces convergence with IFRS

The Institute of Chartered Accountants of India (ICAI) has decided to fully converge with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board for accounting periods commencing on or after April 1, 2011. Like Australia, New Zealand and countries in the European Union, the IFRS will be adopted for the listed entities and other public interest entities such as banks, insurance companies and large-sized entities. The decision is an important milestone in achieving full convergence with IFRS as India will join 102 countries which presently require or permit use of IFRS. By 2011, the number is expected to reach 150. (View the IASB Press Release).

International Financial Reporting Standards — Today’s challenges

Making the transition from Canadian GAAP to IFRS is not just a technical accounting exercise. It will present unique challenges, as it impacts many other areas beyond an organization’s finance and accounting functions. IFRS also places significant responsibility on management to change the way they communicate business results to the market (see PricewaterhouseCoopers Canada).

IFRS illustrative financial statements for 2006

PricewaterhouseCoopers offers several sets of financial statements for an entity's first interim reporting period under IFRS, for an existing preparer of consolidated IFRS financial statements, and for industry-specific entities: banking, insurance, investment funds and investment property. KPMG offers a set of financial statements based on a fictitious multinational corporation involved in general business; the corporation is not a first-time adopter of IFRS. There are also variants on this: a set for first-time adopters, for banks, for investment funds and for investment property companies. BDO International offers two sets of model financial statements of a listed company prepared in accordance with IFRS: one for ongoing reporters and one for first time adopters.

IASB/FASB vision of financial statement presentation

The International Accounting Standards Board (IASB) and the US Financial Accounting Standards Board (FASB) are unveiling their vision of the future of financial statement presentation. Launched in 2004, the joint IASB/FASB effort first concentrated on the income statement (the presentation of income and expenses) but has now been broadened to include the complete set of financial statements. In May 2007, the two bodies posted an update on the IASB website and the FASB website detailing the progress and offering tentative examples of what financial statements might look like in the future.

Principles into Practice – key points

In April 2007, the Institute of Chartered Accountants of Scotland (ICAS) held a conference in co-operation with the American Institute of Certified Public Accountants to consider principles-based accounting and the challenges of implementation. The key points from this conference have been published by ICAS in a June 2007 report Principles into Practice – key points from the New York conference. More information is available on the ICAS website.

SEC staff reviews IFRS financial statements

The US Securities and Exchange Commission has published SEC staff observations arising from their review of the 2006 annual reports of more than 100 foreign private issuers containing financial statements prepared on the basis of International Financial Reporting Standards (IFRS). The comment letters sent to companies along with the company responses are available on the SEC website.

New CESR database on all European listed shares

The Committee of European Securities Regulators (CESR) has launched a new CESR Database on over 7,000 companies trading shares on EU Regulated Markets. Available information includes average daily turnover, number of daily transactions, free float, regulatory oversight authority and country code.

Stewardship/Accountability as an Objective of Financial Reporting

The European Financial Reporting Advisory Group (EFRAG), the UK Accounting Standards Board (ASB) and a number of other European accounting standard-setters have published a brief paper called Stewardship/Accountability as an Objective of Financial Reporting. The paper discusses the rationale for including stewardship or accountability to shareholders as a separate objective of financial reporting. It is available from the EFRAG website and the UK Financial Reporting Council (FRC) website.

Accountants of the world uniting in IFRS revolution

To date, more than 100 countries have abandoned their existing accounting practices in favour of IFRS, with more expected to do so. The shift is not simply a series of technical accounting changes but a cultural transformation as well. It is "one of the biggest revolutions in financial reporting in living memory," according to the foreword in a June 2007 KPMG report "IFRS: The Quest for a Global Language." The report assesses the impact of this upheaval through the experiences and thoughts of those involved.