A majority of CPAs support optional adoption of International Financial Reporting Standards (IFRS) for public companies, according to a recent AICPA survey.
Optional adoption would let publicly traded U.S. companies use IFRS, while the SEC decides whether to incorporate the standards into U.S. reporting requirements. The choice also would apply during the implementation phase, if the SEC accepts the standards.
Support for IFRS remains high among AICPA members. But the survey found that, in the absence of a clear regulatory timetable, U.S. firms and organizations continue to delay planning and preparation for the global standards.
“It’s clear the profession is looking for more guidance from the Securities and Exchange Commission,” Susan Coffey, AICPA senior vice president–Public Practice & Global Alliances, said in a press release. “But whether or not the SEC decides to incorporate IFRS into the U.S. financial reporting system through an endorsement approach, CPAs support giving U.S. issuers an option to adopt IFRS as issued by the International Accounting Standards Board.”
The SEC continues to execute a work plan, published in 2010, to help frame a determination as to whether, when and how the current financial reporting system for U.S. issuers should be transitioned to a system incorporating IFRS. Some 120 countries either use or permit the use of IFRS.
Among other findings of the AICPA’s latest IFRS Readiness Tracking Survey:
- Almost 54% of members support optional adoption of IFRS standards, in line with an AICPA recommendation made this August, while 18% said the SEC should not allow an option to use IFRS, and the rest were unsure. This was the first time this question was asked on the survey.
- Some 44% of respondents said they were delaying IFRS preparations until the SEC reaches a decision.
- Some 36% of survey takers said they were aware of the concept of “condorsement,” outlined in the SEC’s staff paper in May on potential adoption of IFRS, an improvement over the 16% who answered that way in the last survey this spring. The term “condorsement” refers to a hybrid approach of endorsement and convergence on a standard-by-standard basis.
- The survey shows that 79% percent of CPAs have at least basic knowledge of IFRS, a level that has remained virtually unchanged since May 2010. The level of familiarity ranges from rudimentary understanding of high-level concepts to sufficient expertise to train others.
The IFRS Readiness Tracking Survey was conducted via Internet poll between Sept. 7 and Sept. 27 with 1,241 respondents and a margin of error of less than plus-or-minus 3 percentage points.
The tracking survey results were announced Tuesday at the AICPA’s fall meeting of its governing Council. More information on IFRS is available on the AICPA’s website IFRS.com.
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