In response to the SEC’s Work Plan for the Consideration of Incorporating International Financial Reporting Standards into the Financial Reporting System for U.S. Issuers, the AICPA has recommended that public companies be allowed to adopt IFRS.
Paul V. Stahlin, AICPA Chairman, and Barry C. Melancon, AICPA President and CEO, noted, “Whether or not the SEC decides to incorporate IFRS into the U.S. financial reporting system through an endorsement/convergence approach, we believe U.S. issuers should be given the option to adopt IFRS as issued by the IASB.”
“An adoption option would provide a level of consistency in the treatment of U.S. companies and foreign private issuers that report under IFRS that does not exist today, and would facilitate the comparison of U.S. companies that elect IFRS with their non-U.S. competitors that use IFRS. Furthermore, giving U.S. companies an option to adopt IFRS as issued by the IASB would be another important step towards achieving the goal of incorporating IFRS into the U.S. financial reporting system. Anecdotal evidence suggests that the number of companies that would choose such an option would not be such that system-wide readiness would become an issue,” Stahlin and Melancon added.
Given the AICPA’s endorsement, it will be interesting to see what position the SEC takes.
Additionally, in its response, the AICPA supported the recommendation of Blue-Ribbon Panel on Standard Setting for Private Companies to establish a separate board to further develop U.S. GAAP for private companies.
This advice is not intended or written to be used for, and it cannot be used for, the purpose of avoiding any federal tax penalties that may be imposed, or for promoting, marketing or recommending to another person, any tax related matter.
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