In a speech to accounting professors and corporate executives at PwC University for Faculty, PricewaterhouseCoopers U.S. Chairman and Senior Partner Dennis Nally announced the firm's release this month of a full suite of educational tools and programs designed to help American accounting students learn the fundamentals of International Financial Reporting Standards (IFRS).
IFRS describes the financial reporting treatment long used by companies outside the United States and which is expected to replace U.S. companies' use of the venerable Generally Accepted Accounting Principles (GAAP) over the next few years.
PwC's program, IFRS Ready, is the first corporate education program on IFRS being rolled out directly to interested students and the first such program to provide tools for professors to use in their classrooms linked to the student materials.
Nally said the launch of this new program is emblematic of changing times in the world of financial reporting.
"Back in the not too distant past, whatever standards the United States favored would likely be followed by the rest of the world because of the paramount importance of access to the U.S. capital markets," Nally said. "But, as we are seeing with the apparent selection of IFRS over GAAP, that is no longer the case. IFRS is growing as the de facto reporting standard around the world."
The globalization of business and finance has led to the successful mass adoption of IFRS by upwards of 12,000 companies in more than 100 countries. The option for U.S. companies to apply IFRS may come sooner rather than later, with a mandatory conversion date arriving in the not too distant future. Nally's speech highlighted the steps that PwC is taking to ensure that America's accountants and accounting students are prepared to deal with the shift.
"The adoption of IFRS will make our own capital markets more competitive because U.S. issuers will be better able to compete for capital in sectors in which non-U.S. companies now report under IFRS," Nally told the gathering. "What's more," he added, "embracing a single set of global accounting standards will contribute to a high degree of investor understanding and confidence."
With IFRS Ready, students can watch videos that explain what IFRS is, why it matters, and its effects on accounting today. They can use interactive IFRS financial statements that enable them to roll their cursors over text that explains the differences between IFRS and U.S. GAAP treatments. They can even follow a fictional PwC staff member as he starts on his first IFRS engagement.
Dave Kaplan, PwC partner and U.S. leader of international accounting and SEC reporting, described PwC's interactive learning tool as unique. "It is an engaging experience for students," Kaplan said. "It focuses them on many of the larger accounting differences between the two sets of standards." Kaplan added that it is also "an easy way for professors to introduce international standards to their students and start them down the path toward understanding IFRS, the set of accounting standards that students will use for the vast majority of their business careers."
For professors, PwC provides slides, speaker notes, and questions and answers on IFRS topics that can be integrated into both introductory and intermediate accounting classes. PwC is making these materials widely available to thousands of faculty across the country, including those at community colleges. The firm is also sponsoring a competitive grant program to recognize faculty use of the IFRS materials in class, as well as other grants that encourage curriculum change to integrate IFRS.
PwC first addressed the need for curriculum reform to incorporate international standards with accounting faculty at the firm's 2002 Accounting Symposium in San Antonio, Texas. In fall 2007, the firm began developing the materials for the IFRS Ready program being launched this month. PwC's investment in IFRS related initiatives is expected to exceed $1 million, plus hundreds of hours of partners' and other professionals' time developing programs.