Mastering the new financial lingua franca
22 Dec 2009
Deloitte's Global Center for Corporate Governance has published the second annual edition of its year-end Directors' Alert.
Entitled Survival or Success: 10 Issues for 2010, the report represents a collaboration among the governance teams from 11 Deloitte member firms. It describes 10 key issues for boardrooms to consider in the New Year. Click to download Directors' Alert: 10 Issues for 2010 (PDF 244k). One of those key issues is mastering the new financial lingua franca – the linga franca being, of course, Internatonal Financial Reporting Standards.
Directors who oversee financial reporting must familiarise themselves with the new accounting framework as soon as possible. Audit committee members have an additional concern: many jurisdictions require them to be 'financially literate', which will mean being literate in an IFRS world. It is likely that many directors will need to upgrade their skills under an IFRS regime. This Alert suggests some steps directors can take take to help master the language of IFRS.
The question for many boards is: how well do they 'speak' the new financial lingua franca? Mastering IFRS, just like learning a new language, poses a number of challenges:
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