December 7, 2008
I am submitting these comments on the roadmap to IFRS document. While I agree that US investors, issuers and markets will benefit from a single set of global standards I beleive your timing is too distant. A decision to proceed needs to be made now and should make it mandatory for all publicly listed firms to start Jan 1, 2012. If possible it should be 2011. In part this can be accomplished by announcing it now, and by using your suggestion of the 10K and 10Q form for the 2 years of IFRS audited financial statements.
Moving to IFRS will provide a strong competitive advantage for US firms and industry which is even more important in the current economic crisis. I would suggest allowing voluntary transition immediately to any firm that wants to make the switch and only requiring 2 years of audited financial statements in the form of restated finanicial statements for comparison purposes rather than actual audited financial statements. Quite simply, it would take far too long by having actual audited financial statements for 3 prior years. If you required 2 years this may mitigate things in a middle of the road approach but as huge portions of the world have already adopted IFRS, and others, like Canada are imminent, the US will remain at a serious competitive disadvantage in terms of comparisons, if the change is held to 2014. Further, I would phase it in by allowing voluntary compliance perhaps 2010, and mandatory for large international firms for 2011. Others could then be phased in with 2012 as the final mandatory date. This would make the transition time much shorter, which is a key advantage.
The concern of education in IFRS, while important, is not critical as the market would meet demand. There will be issues with the transition but deferring the transition will only serve to defer the issues, not eliminate them. i.e. by giving industry a longer time to transition, they will simply take their time. If you set a very short transition time for those doing so voluntary, and only a slightly longer mandatory time many firms will begin working to transition immediately.
Wayne Solomon, ACMA, CMA, Acc.Dir.