Ernst & Young LLP has announced the formation of the Ernst & Young Academic Resource Center, a new collaboration between the firm's professionals and university faculty. The Center will develop curriculum and arm faculty members with time-critical learning materials focused on International Financial Reporting Standards (IFRS) which will help the next generation of accounting professionals meet the fast-changing needs of the global financial markets.
"The changes that are now clearly on the horizon around International Financial Reporting Standards will create a seismic shift around the knowledge and content that U.S. students will need to learn in the coming years," said Douglas Shackleford, Meade A. Willis Professor of Accounting at the University of North Carolina's Kenan-Flagler Business School. "It is exciting that Ernst & Young is looking to work with faculty to address these issues."
"In my view, the use of IFRS by U.S. companies, particularly public companies, is inevitable," said Randy Fletchall, Chairman of the American Institute of Certified Public Accountants and Ernst & Young's Americas Vice Chair of Assurance and Advisory Business Services' (AABS) Professional Practice and Risk Management. "It is a question of how soon, and whether there will be an option to early adopt IFRS prior to a date when required. All participants in the financial reporting system need to focus on our preparedness for making a successful conversion from U.S. GAAP to IFRS."
The incoming 2008/2009 class of students will likely need to understand new financial reporting standards when they enter the workforce in 2012. Although a date has not been set to adopt IFRS in the U.S., most European Union countries are already required to use IFRS and the SEC has approved a change in its rules such that foreign private issuers using IFRS are no longer required to reconcile their financial statements with U.S. GAAP.
In a May 2008 report, the Treasury Department's Advisory Committee on the Auditing Profession specifically called on private industry, educators, regulators and others to work together to implement market-driven, dynamic curricula and content for accounting students that continuously evolve to meet the needs of the auditing profession and help prepare new entrants to the profession to perform high quality audits.
"Ernst & Young is already working intensely with clients to navigate the IFRS landscape," noted Ellen Glazerman, Ernst & Young's Americas Director of University Relations. "We see the development of this Academic Resource Center as a way to step up and leverage our global experience and knowledge to help prepare tomorrow's leaders to meet the changing demands of the global financial marketplace."
The Ernst & Young Foundation has committed an initial investment of $1 million toward the Academic Resource Center, which will develop or co-develop teaching materials, host subject matter conferences, and provide on-campus speakers, among other activities. Staffed by Ernst & Young professionals and rotating faculty in residence, the Center will officially launch in September 2008, and curricula will begin to be distributed to campuses as early as January 2009.
Although the Ernst & Young Academic Resource Center will initially focus on IFRS, the mission of the Center will be to address the newest, most significant developments impacting the tax and accounting profession. As regulation or laws change, the Center will focus its resources on these emerging topics and develop real-time materials to support faculty.