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55% of CFOs Think U.S. Firms Should Be Permitted to Use IFRS Instead of GAAP

October 21, 2008

In a national survey of chief financial officers and senior comptrollers conducted by Grant Thornton LLP, the U.S. member firm of Grant Thornton International Ltd., 55 percent of respondents believe that all U.S. firms should be permitted to use International Financial Reporting Standards (IFRS), instead of U.S. Generally Accepted Accounting Principles (GAAP), in financial statements filed with the SEC.

Yet, 59 percent disagree with the SEC’s December 2007 decision to permit foreign firms listed on U.S. exchanges to file financial statements prepared according to IFRS without reconciliation to U.S. GAAP. Only one in five of respondents have experience preparing financial statements according to IFRS.

“The results tell us that although the respondents don’t yet have a lot of hand’s-on experience, they can tell that U.S. companies should not be put at a disadvantage when it comes to reporting requirements that allow for the use of IFRS,” said Gary Illiano, partner-in-charge of Grant Thornton LLP’s International and Domestic Accounting.

More than half of CFOs are familiar with eXtensible Business Reporting Language (XBRL), but only 2 percent actually use it when reporting their company’s financial results. Of those who do not use XBRL, 92 percent have no plans to do so at this time.

Do you have experience preparing financial statements according to International Financial Reporting Standards (IFRS)?

 Yes        20% -------------- No         80% -------------- 

Should all U.S. firms be permitted to use IFRS, instead of U.S. GAAP, in financial statements filed with the SEC?

 Yes        55% -------------- No         45% -------------- 

Do you agree with the SEC’s December 2007 decision to permit foreign firms listed on U.S. exchanges to file financial statements prepared according to IFRS without reconciliation to U.S. GAAP?

 Yes        41% -------------- No         59% -------------- 

Should privately held U.S. firms be permitted to use “IFRS for Private Entities” when preparing financial statements?

 Yes        67% -------------- No         33% -------------- 

Are you familiar with eXtensible Business Reporting Language (XBRL), referred to by the SEC as “Interactive Data”?

 Yes                                                   54% --------------------------------------------------------- No                                                    46% --------------------------------------------------------- 

Does your company currently report financial results using XBRL?

 Yes         2% -------------- No         98% -------------- 

If no, when do you plan to report using XBRL?

 No plans at this time 92% ------------------------- Before 2010            6% ------------------------- Before 2009            2% ------------------------- 

The FASB and the AICPA established a committee that provides input from private companies to the FASB. Do you believe that the information needs of users of financial statements of private companies differ significantly from the information needs of users of financial statements of companies that file with the SEC?

 Public     Private Overall    companies  companies ------------------------------------------- Yes           65%        51%        70% ------------------------------------------- No            35%        49%        30% ------------------------------------------- 

Do you support the recent Financial Accounting Standards Board (FASB) proposal to change accounting for contingent liabilities (FAS 5)?

 Yes        58% -------------- No         42% -------------- 

Do you agree with the FASB’s amendment of the definition of “discontinued operations” to include held-for-sale acquisition?

 Yes        64% -------------- No         36% -------------- 

Does your firm intend to use the fair value option in Statement 159 to account for:

 Yes No ----------------------------------- Liabilities                 35% 66% ----------------------------------- Equity-method investments   31% 69% ----------------------------------- Derivatives                 28% 72% ----------------------------------- Other financial instruments 32% 68% ----------------------------------- 

Would you support supplementing financial statements with nonfinancial measure that provide more relevant information about your organization and its value drivers?

 Yes        85% -------------- No         15% -------------- 

About the Survey

Grant Thornton LLP conducted the national survey from September 8th through September 19th, 2008 with 688 chief financial officers and senior comptrollers.

About Grant Thornton LLP

The people in the independent firms of Grant Thornton International Ltd provide personalized attention and the highest quality service to public and private clients in more than 100 countries. Grant Thornton LLP is the U.S. member firm of Grant Thornton International Ltd, one of the six global audit, tax and advisory organizations. Grant Thornton International Ltd and its member firms are not a worldwide partnership, as each member firm is a separate and distinct legal entity.

In the U.S., visit Grant Thornton LLP at www.GrantThornton.com.




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