Many United States companies have not begun preparations for the possible transition from generally accepted accounting principles to International Financial Reporting Standards. Among the challenges companies face in making the conversion--in addition to the expense of upgrading information technology systems--include finding the right talent to make the transition smooth and efficient.
These are some of the notable finding of the Protoviti Inc. survey that was conducted last May. Protiviti is a Menlo Park, Calif., business-consulting and internal-audit firm.
"Now is the time for companies to begin determining the steps they will need to take to ensure that their conversion to IFRS is as seamless and cost-effective as possible," says Christopher Wright, managing director of Protiviti, in a statement. "Conducting a diagnostic review of "everything, from financial policies and disclosures to data flows is strongly recommended now to scope out all the possible ways a company and its finance function could be impacted."
On Aug. 27, the five U.S. Securities and Exchange commissioners voted unanimously to publish a roadmap that could lead to adoption of IFRS by 2014, if seven milestones were met by 2011. In mid-November, the roadmap was published in the Federal Register with a 90-day comment period.
Among other key survey findings:
* 48 percent of the respondents report their organizations have made no preparations to date to adopt IFRS.
* More than 40 percent say that if the SEC allows a choice between using U.S. GAAP and IFRS, they'd choose IFRS.
* Presently, most companies don't have a project management office assigned to lead the transition.
* More than 60 percent say they anticipate at least a...