IFRS

Adoption by U.S. public companies of International Financial Reporting Standards – IFRS – over the next five to seven years will change the lives of financial managers. The sooner they start preparing for the change, the better they will be able to accommodate it

Key Advice on Preparing for IFRS

Karl Braun – International Partner, US IFRS Project Management Office, KPMG; Alan McKinnon, Jr. – CFO, Vietnam – Chipscale Advanced Packaging Services; Michael Malwitz – Director, Product Strategy, Oracle; and Kevin Woods – Senior Consultant, Accounting Management Solutions, Inc offer the following advice on preparing for IFRS:

• Don’t resist the IFRS movement: it’s coming.
• Take the long view. Transition will require effort, but it should lead to smoother audits.
• Get your board to agree earlier rather than later on the need to get ready for IFRS.
• Educate your people on the business so they can consistently articulate it to auditors.
• Talk to your foreign peers to gain an understanding of what worked in preparing for IFRS.
• IFRS offers a rare fresh start to think about accounting policies; choose them wisely.
• Begin to think about your business in terms of IFRS, e.g., what would this transaction look like under IFRS?
• Get your IT systems in shape. Avoid spreadsheet solutions for IFRS.
• Modify or negotiate loan covenants that provide for an orderly transition to IFRS without incurring any penalties.