The Canadian Accounting Standards Board has confirmed that use of International Financial Reporting Standards will be required in 2011 for publicly held profit-oriented companies.
IFRS will replace Canadian generally accepted accounting principles. The official changeover date for financial statements is for fiscal years beginning on or after Jan. 1, 2011.
Like the U.S., Canada has been converging toward use of IFRS. The Canadian Accounting Standards Board had originally proposed the 2011 starting date in January 2006 when it announced its plan to adopt IFRS. The announcement this week confirms that it is still on track.
Canadian securities and accounting regulators want Canada to follow the lead of the U.S. and other countries in adopting the international standards. "Canada should not stand in isolation from the growing acceptance of a common financial reporting language," said Paul Cherry, chair of the Canadian Accounting Standards Board, in a discussion paper.
Last year, the U.S. Securities and Exchange Commission allowed foreign companies to file in IFRS without reconciling in GAAP, and may allow U.S. companies to do so this year. It too is encouraging convergence between GAAP and IFRS.
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