International Accounting Standards Board (IASB) Chairman Hans Hoogervorst recently commented that he expects the SEC to adopt IFRS for U.S. issuers. This comes on the heels of SEC Chief Accountant James Kroeker saying the SEC needed at least a few more months to produce a final report that would prepare the commission to decide on IFRS.
This sentiment was reiterated by SEC Chairman Mary Schapiro. “There are some hurdles that have to be passed before we’re going to be comfortable making the ultimate decision about whether to incorporate IFRS into the U.S. reporting regime,” she said.
“The U.S. ultimately will come on board,” Hoogervorst said. “Quite simply, they need us and we need them.” “The U.S. is committed to supporting global accounting standards,” he said. “It is SEC policy, it is U.S. government policy and it is the policy of the G20, in which the U.S. is a key player.”
“This is not an easy decision to make,” Hoogervorst added. “The U.S. already has developed a sophisticated set of financial reporting standards over many decades. Transitional concerns have to be carefully considered.”
There are three remaining Memorandum of Understandings projects – financial instruments, revenue recognition and leasing. A revised exposure draft on revenue recognition was released in November, and a revised exposure draft on leasing is expected to be released in the first half of 2012. In late January, the Boards announced that they are working together to reduce differences in their respective classification and measurement models for financial instruments.
How and when these projects ultimately wrap up could go a long way in determining when and in what fashion the U.S. adopts international standards.
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