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ICAEW guidance on audit implications of IFRSs

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28 Jul 2004

The Institute of Chartered Accountants in England and Wales has published guidance on (PDF 93k) intended to assist auditors in assessing the state of their clients' readiness for the transition to IFRSs and to prepare for the auditing implications.

The guidance warns against complacency that there are not many differences between UK GAAP and IFRSs:

It is easy to make a high-level comparison of UK GAAP and IFRS and conclude that there are few major differences; however there are many important detailed differences, many of which will be discovered only by a thorough analysis of a company's transactions and exposures. Matters that need to be considered include:

  • changes brought by the move to IFRS will mean a major change in the actual format of the accounts;
  • differences in definitions may mean that items previously classified in one way will need to be classified differently;
  • some items that are not recognised under UK GAAP are recognised as assets or liabilities under IFRS, whilst others may cease to be recognised;
  • some items may have to be measured differently in the accounts of an individual subsidiary and in the consolidated accounts;
  • more extensive disclosure requirements will result in greater data capture needs; and
  • some changes in accounting policies may require accounting systems to give different information.
Click for (PDF 36k).

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