IFRSs and private company reporting in the United States
29 May 2009
The Deloitte United States Center for Corporate Governance has published International Financial Reporting Standards: What it Means for Private Company Reporting.
- Download IFRS: What it Means for Private Company Reporting (PDF 725k)
- Go to the Deloitte Center for Corporate Governance Website
The benefits of global standards are not limited to public companies, as markets are also becoming integrated for private companies, both large and small. More and more private companies are looking to do business across borders and obtain financing from foreign sources. Reduced complexity, greater transparency, increased comparability, and improved efficiency are all potential benefits of IFRS and IFRS for Private Entities*. Both IFRS and IFRS for Private Entities also may reduce the burden of financial reporting on private companies, thereby reducing compliance costs. Not only might private companies benefit from a common set of reporting standards, but the users of their financial statements, particularly those in different jurisdictions, would likely benefit as well. Users such as lenders, vendors, customers, venture capitalists, and non-management owners will need to understand only one set of standards in their dealings with private companies in different jurisdictions.... IFRS or IFRS for Private Entities may be a welcome alternative to US GAAP for many private companies. The factors that drive the choice of a reporting standard, however, are unique to each company's objectives and growth strategies. In making the choice, private companies will likely benefit from carefully evaluating the options and measuring the potential costs and benefits. *Shortly after this publication went to press, the IASB decided that the final name of the standard will be IFRS for SMEs. |