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| Focus on Accounting: International Financial Reporting Standards (IFRS) Update |
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International Financial Reporting Standards (IFRS) are a comprehensive set of accounting principles for the preparation of financial statements. While most all companies in the United States currently follow U.S. generally accepted accounting principles (US GAAP), the rest of the world has been moving to IFRS. Currently, publicly traded companies in the European Union must follow IFRS, and several other countries either permit or require IFRS for financial statements. In a groundbreaking move, the SEC recently decided to allow foreign issuers that file periodic reports in the United States to do so using IFRS, and eliminate the requirement for a reconciliation of those financial statements to US GAAP. This raises the question of whether US public companies should also be allowed, or required to use, IFRS. That question may be answered later this year, when the SEC has promised to publish an updated “roadmap” for the adoption of IFRS. Due to the support of the SEC, many see the eventual adoption of IFRS by all US companies, public and private, as a real possibility. Even without mandatory adoption, we would expect most companies would eventually be impacted by IFRS and need a basic working knowledge of the key differences with US GAAP. With the impact of globalization spreading to private and small companies, it will become more likely that companies will need to evaluate the IFRS based financial statements of their customers, suppliers, and competitors. RubinBrown is monitoring IFRS adoption developments, and is continuing to assess their impact for all companies. Below are a few IFRS links you may find helpful:
AICPA IFRS Website
International Accounting Standards Board
For more information contact:
Eric Janson, CPA |
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| Horizons Magazine |
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 2007 Horizons Tax Guide Visit the Resource Center to access past issues of Horizons Magazine, as well as a variety of other articles and topics of interest. |
