Everything’s NOT getting up to date in Kansas City.
The SEC’s plan initially allowed early adopters to use IFRS by 2010 and required all public companies to adopt it by 2016. But new SEC chief Mary Shapiro says it’s not one of her priorities.
But is international convergence inevitable, with or without IFRS?
James Dornbrook in the Kansas City Business Journal says local CPAs are holding back:
- Cheryl McConnell, professor of accounting at Rockhurst University’s Helzberg School of Management, said investors in this economy need consistent and comparable financial statements. They won’t get that shifting to IFRS. “There is no question that the urgency we all felt for educating (accounting/auditing) students into IFRS has diminished now,” McConnell said. “That said, we are actively seeking to educate our students for a new global world.”
- Rick Mills, president of CBIZ Accounting, Tax and Advisory Services, said the cost of converting to IFRS also plays a role. He said the top 100 U.S. corporations would pay about $20 million each to convert to IFRS. Smaller public companies will pay about $2 million each. “So that’s pretty high considering the economy we’re in right now,” Mills said. The move to IFRS may slow but won’t stop, he said. So CBIZ continues to train employees for an inevitable conversion.
- Grant Thornton partner Mike Krzus said the future of accounting will see a combination of IFRS and eXtensible Business Reporting Language (XBRL), a new interactive electronic data system. The XBRL system, being phased into public companies during the next three years, allows people to easily compare numbers for different companies. XBRL will be more useful with the addition of new non-financial data to help investors make better decisions, he said.”What’s more important, knowing the health of a pharmaceutical company’s production plant in Indiana or knowing how many new drugs are in the pipeline?” Krzus said.
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