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A Tiered Approach to IFRS Conversion – Illustrative*

Reporting Date

Transition Date


IFRS Competence


  • Awareness

  • Assessment

  • Planning

  • Initial Training

  • Roadmap

2011 – 12

2009 – 10

• Statutory Implementation

• Targeted Statutory Implementation

• Prepare IFRS opening balance sheet

• System and process redesign

• “Dry Runs”


• Transition to IFRS

• U.S. GAAP and IFRS opening balance sheet

• Quarterly Reporting

• Investor Communications

  • Investor


  • Audit Procedures

Alignment with other initiatives and training for appropriate personnel

Rationalization and standardization of statutory reporting

  • *

    The chart reflects the IFRS requirement of three years of income statement reporting (two historical years and the current year) and two years of balance sheet reporting (one historical

year and the current year).

The Roadmap

Whether you plan to charge ahead full steam or take small, measured steps, performing an initial assessment and developing an IFRS implementation roadmap will be a good starting point. Through this effort, you’ll likely be able to chart the optimal course, determine the pace of your journey, and improve your chances of skirting any detours and potholes.

If you take only one action after reading this document, we suggest it be this: Develop an IFRS implementation roadmap. To kick off this effort, ask yourself and your team a few preliminary questions to gauge the potential impact of IFRS on your company.

  • Have we inventoried our current IFRS reporting requirements, if any?

  • How many local GAAPs do we currently report under?

  • How many of our business units already prepare IFRS financial statements?

  • How might our access to capital be impacted by an IFRS conversion?

  • How many of our competitors have converted to IFRS? Is there an expectation that they would switch to IFRS, if given the choice in the U.S.?

  • Do we have a major ERP or finance transformation project in the works?

  • Are we involved in or considering a major acquisition?

  • What is the level of IFRS knowledge within the company, both domestically and globally?

  • What would be the impacts on our company of a possible IFRS requirement in the U.S.?

  • Have we assessed the cost and benefits of adopting IFRS?

The answers to these questions will influence the timing and pace of your IFRS implementation.

Of course, your final roadmap will contain significantly more detail than shown above. Given the far-reaching scope of IFRS, your map-making process may assess the potential impact on each department in your organization, including finance, human resources, tax, legal, information technology, and investor relations. Other stakeholders should also be involved, including the board, audit committee, shareholders, and your external auditor.

By determining your costs, benefits, and timing up front, you can avoid a rushed approach and incurring unnecessary expense. A carefully designed roadmap may empower your company to convert on its own terms. By taking a measured and informed approach, you increase the likelihood of identifying value in an exercise that otherwise may be reactive and solely compliance driven. The value may show itself in the form of reduced costs of implementation, standardization of statutory reporting activities and related controls, greater standardization of accounting policy application, and possibly core finance transformation.


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