Financial reporting standards are going global. Some 90 percent of 59 countries surveyed in research conducted by the six largest accounting firms said they intend to converge with International Financial Reporting Standards (IFRS).
Results from GAAP Convergence 2002– research conducted jointly by BDO Seidman, Deloitte Touche Tohmatsu, Ernst & Young, Grant Thornton, KPMG and PricewaterhouseCoopers– found that 72 percent of countries who are moving toward IFRS said they have a formal strategy in place to do so.
GAAP Convergence 2002 was undertaken to gauge the extent and maturity of IFRS preparations on a global basis.
However, about 51 percent of the companies in the study indicated that the complex nature of select international standards such as financial instruments, and others incorporating fair value accounting, presents a barrier to achieving convergence in their respective counties.
As a result, many countries stated they are currently limiting implementation of IFRS to listed companies, rather than extending it to all companies.
Those responding to the survey stressed the importance of better and more timely access to national language translations of the new standards and interpretations. While translations of international standards were available in 70 percent of the countries covered, in many cases the translations were not sanctioned by the International Accounting Standards Board.
Another area of challenge identified was the availability of IFRS training.