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The Comments Are In

April 26, 2009

The comment period for the SEC’s Roadmap to IFRS is now over. There were 175 comment letters sent to the SEC with the largest group of respondents being preparers of financial statements. One common view stood out: the end goal must be a single set of high quality financial standards for use domestically as well as globally. But that is where the similarities end. There was a wide divergence of views in how to get to that high quality set of financial standards for use domestic and global use. Some favor convergence while others favor conversion. Many favored the move to IFRS while others thought the high cost of conversion doesn’t have much of a payback. Many supported reporting one year of comparative results as opposed to the two required in the proposed roadmap. Many expressed concerns over the conversion timeline if the SEC waits until 2011 to approve the Roadmap.

So where do we go from here? The SEC will weigh the comments for the next several months. I would not expect them to take any action until later this year. All options are currently on the table including retaining US GAAP, continuing convergence, choice between US GAAP and IFRS, unrestricted use of IFRS and a date certain timetable for adopting IFRS. In 2009 we can expect potential early adopters to make their decisions about whether to adopt early, until 2011 we can expect the SEC to continue monitoring progress against the Milestones, in 2011 (if not earlier) the SEC is to potentially approve the Roadmap, and 2014 through 2016 we could see the staged adoption of IFRS.

Have you assessed the impact of IFRS on your company?

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