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The standardization of financial statements on an global level is an important agenda item for the FASB, IASB and all users of financial statements. In a recent conference held by the FEI ( Financial Executive International) regarding Financial Reporting Issues, FASB Chairman Robert H. Herz and IASB Vice Chairman Thomas E. Jones presented some general issues and thoughts regarding the alignment of US GAAP and IASB. Ironically, Mr. Herz pointed out that while over 100 countries have adopted IFRS, many of them have added to or modified the IFRS standards they adopted, defeating the purpose of a standardized system. Other items discussed included the the level of detail included in IFRS as compared to highly detailed US GAAP standards, and the likelihood of the US eventually moving to IFRS. According to Mr. Herz, the benefits of a global implementation of IFRS include decreased cost of capital, increased worldwide investment and reduced reporting costs for domestic firms with international operations. While updated guidance regarding statements 133 and 140 is expected in 2008, the timing regarding a transition plan for US Companies to move to IFRS is still very uncertain.

Category(s): Valuation Thoughts
Posted by James Drybanski at 10:34 PM | Permalink | Comments (0) | TrackBacks (0)