September 11, 2014
In our previous post we have discussed on how IFRS is moving towards becoming a global accounting standard.
In 106 countries, all or most domestic public companies are required to report under IFRS, according to a review of 130 countries by the parent of the London-based International Accounting Standards Board. Another 15 countries permit or require the use of IFRS at least for financial-services companies.
USA is one of the 7 nations worldwide that still don’t let their companies report according to the IFRS.
The U.S. Financial Accounting Standards Board and the IASB have been working together for more than a decade to align their rules of accounting.Still there is disagreementdespite their hope to wrap up that project next year.
There is a worry among the U.S investors that the moving U.S. companies to IFRS and adopting new approaches, wouldn’t return sufficient benefit to justify the cost.
Ms. White, U.S Securities and Exchange Commission’s Chairman, has made a priority to give more direction on IFRS but didn’t comment on whether she is considering giving U.S. companies an option to use international rules.
The U.S, however has exceptions and allows about 500 U.S.-listed foreign companies, such as HSBC Holdings PLC and Unilever PLC, to report results solely according to IFRS. The IASB views these exceptions as an indication of SEC’s belief that IFRS accounting will not harm the investors.