April 21, 2011
To the Committee:
I wholeheartedly believe that IFRS is the direction that the U.S. should go in regards to financial reporting for public companies. However, the major issue I have with IFRS is in the area of fair value for tangible and intangible assets versus historical cost. I believe that fair value cannot be reasonably achieved without the potential for misrepresentation of asset valuations in this area. I would propose that historical cost still be used with the adoption of IFRS.
Or, as a secondary choice, show fair value on the balance sheet with historical cost information contained in parenthesis within the financial statements.
Of course, this would require adjustments to IASB rules, but this could be negotiated.
The use of U.S. GAAP should continue for private entities, since it is understood by most business professionals and is engaged primarily in domestic, and not international markets.