SEC proposes a 'roadmap' to IFRSs for domestic US registrants

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28 Aug 2008

On 27 August 2008, the US Securities and Exchange Commission voted to publish for public comment a proposed 'roadmap' that could lead to the use of International Financial Reporting Standards (IFRSs) by US issuers beginning in 2014. Currently, US issuers must use US GAAP, though foreign registrants (of which there are around 1,100 from 52 jurisdictions) may elect to use IFRSs.

The proposal suggests mandatory adoption by US registrants could be phased in from 2014 to 2016 depending on company size:
  • Large accelerated filers in 2014
  • Accelerated filers in 2015
  • Non-accelerated filers in 2016.
The proposal also would permit voluntary early adoption for a limited group of large US registrants (based on industry and size, roughly 110 companies eligible) for periods ending after 15 December 2009 (filings in 2010). However, mandatory IFRS adoption starting in 2014 would not be automatic. In 2011, the Commission would evaluate the progress of IFRSs against certain defined milestones and make a decision on whether to go ahead with adoption starting in 2014, later, or not at all. Here is the SEC Press Release (PDF 30k). The SEC has not yet posted the full text of the proposal on its website. There will be a 60-day comment period that begins when the roadmap proposal is published in the Federal Register. Financial Executives International has issued a Press Release (PDF 37k) stating that "FEI supports the SEC's decision today to propose a Roadmap for US issuers for filings of financial statements prepared in accordance with IFRS." [This story has been expanded from our original posting.]

 

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