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IFRS Transition

Will your transition to IFRS be made as seamlessly as possible? If so, you need to plan, prepare, execute with appropriate lead times to allow completion of transition activities. IFRS will impact virtually every area within you company. There are many preparations to be made in every area that is impacted.

  • Accounting & Finance
    • Valuations of assets/liabilities
    • Accounting calculations
    • Supporting documentation
    • Policies and procedures
    • Financial Statements
    • Footnotes
    • Regulatory requirements
  • Internal Audit & Controls
    • Scoping methodologies
    • Internal controls for new procedures
    • Control documentation
    • Testing approaches
    • Professional standards utilized (use US standards or international standards)
  • Information Technology
    • Accounts & chart of account structure
    • IT controls for IFRS data conversions
    • Controls around new applications
    • Data privacy controls
  • Tax
    • Review of current processes for gathering tax data
    • Uncertain tax position processes (since these will change)
    • Change in the starting point for all tax positions (IFRS financials vs US GAAP financials
    • Changes related to FAS 109, FIN 48, FAS 123R
  • Treasury
    • Debt covenants
    • Hedging agreements
    • Legal agreements that require audited financial statements
  • Planning and Budgeting
    • Strategic plans and initiatives
    • New approach to budgeting and planning
    • Inclusion in accounting and finance planning
    • Research and analysis of competitors
  • Management Reporting
    • Impact on key performance indicators and similar metrics
    • Management report impact
    • Impact on competitiveness
  • Investor Relations
    • Planning and timing of external communications
    • Communicating the financial impact with shareholders, analysts and the public
  • Human Resources
    • Incentive compensation plans
    • Training
    • Development of talent
    • Management of contractors & consultants needs to assist with the transition

With so many areas being impacted in some way, wouldn’t it be nice to smoothly transition over an appropriate lead time? What is the appropriate lead time – three years? –five years? Consider this question carefully. If your company must prepare to present three years of financial data publically effective December 31, 2014 (2015 or 2016 depending on size of organization), when do you need to begin preparing?

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