November 17, 2008
I believe that progression towards IFRS in this manner is dangerous. As it stands IFRS is a principles based standard, which will drive up audit costs. It will also make financial statements unreliable as there will be so much more subjectivety present, even more than we already have under U.S. GAAP. U.S. GAAP is definitely not the best system, but it is a standard that has stood the test of time. IFRS is being tooted as the next big thing when in fact U.S. GAAP was derived from a simple framework to the complicated mess we have now due to domestic jurisdictional differences. Can you imagine the mess we will be in a few years from now? Once again we will create a mess that our children will have to fix. The current process of slow progression to a global standard is best, but mandating IFRS is barking up the wrong tree. I just don't understand why no one can forsee that in ten or twenty or thirty years we will have the same complicated rules based standards, only this time there will be jurisdictional differences on a global level, which will drive the costs of compliance to astronomical levels. We shold abandon this roadmap towards mandating anything. Haven't we learned yet that the market will control when all companies will or will not have not to do something. This is just another government mandate that will cost much more than any forseeable benefit.