CFOs divided over need for IFRS

In a national survey of CFOs and senior comptrollers conducted by Grant Thornton LLP, the U.S. member firm of Grant Thornton International Ltd, half believe that U.S. companies should be permitted to use IFRS, instead of U.S. GAAP, in financial statements filed with the SEC, while half disagree.

"It appears that finance professionals have begun choosing whether they want to be in the pro-IFRS or anti-IFRS camp," noted Gary Illiano, Grant Thornton's national partner in charge of International and Domestic Accounting, "and it's pretty evenly divided. Funny, but it wasn't that long ago that we were all saying, 'IFRS – what's that?'"

In addition, if given a choice, 40 percent of senior financial executives would choose to never use IFRS, 20 percent say they would start in 2011, 19 percent say later than 2016 and another 18 percent say 2014.

"There are so many critical choices that financial executives must make," said Illiano, "especially in the current environment. Deciding whether and when to switch to IFRS is a big one; it cannot be rushed or taken lightly."

With respect to the tax implications of converting to IFRS, many issues remain open, said Randy Robason, Grant Thornton's national partner in charge of Tax Risk and Accounting Services. The areas that touch the determination of tax liability are exceedingly complex and require extensive study to fully understand the options and their impact at both federal and state levels. And, of course, some significant provisions such as IAS 12, Income Taxes have not been finalized and therefore the impact cannot yet be determined, which adds further pressure on the conversion schedule said Robason.

Do you have experience preparing financial statements according to International Financial Reporting Standards (IFRS)? All Public Private
Yes 15% 17% 15%
No 85% 83% 85%

Should all U.S. companies be permitted to use IFRS, instead of U.S. GAAP, in financial statements filed with the SEC? All Public Private
Yes 49% 44% 50%
No 51% 56% 50%

Are you familiar with the proposed IFRS for private entities (recently renamed IFRS for Non-publicly Accountable Entities)? All Public Private
Yes 30% 26% 31%
No 70% 74% 69%

Should privately held U.S. firms be permitted to use IFRS for private entities when preparing financial statements? All Public Private
Yes 36% 40% 35%
No 20% 21% 20%
Don't know 44% 39% 45%

Would you be interested in using IFRS for private entities for your company's financial statements? All Private
Yes 31% 34%
No 35% 36%
Not applicable 34% 30%

Given a choice, when would you begin to use IFRS (either the full IFRS or IFRS for private entities) to report your company's financial statements?* All Public Private
2011 20% 20% 20%
2014 18% 20% 18%
2016 4% 3% 4%
Later 19% 22% 18
Never 40% 35% 40%

*May not total 100% due to rounding.

About the Survey

Grant Thornton LLP conducted the biannual national survey from March 23rd through April 4th, 2009, with 530 U.S. chief financial officers and senior comptrollers participating. In its fifth year, the Grant Thornton Survey of Senior Financial Executives is the longest running survey of its kind.

You may like these other stories...

The Financial Accounting Standards Board (FASB) remains unwavering in its support of a dual-model approach to bringing leases onto corporate balance sheets, despite its UK-based counterpart saying last week that it decided...
The prospect of International Financial Reporting Standards (IFRS) being fully adopted in the United States in the near future are growing less likely, as the Financial Accounting Standards Board (FASB) and the International...
A new report by the Certified General Accountants Association of Canada (CGA-Canada) reveals that the adoption of International Financial Reporting Standards (IFRS) has had a noticeable impact on the financial statements of...

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 21
Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience's communication style.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.