While U.S. and international accounting standards seem set on an inevitable convergence path, some are worried that the U.S. approach may end up becoming a bad influence on International Financial Reporting Standards.

At a series of panel discussions and public interviews Tuesday on the global integration of accounting standards, sponsored by Pace University's Lubin School of Business, several of the assembled accounting experts acknowledged that IFRS is not going to be the same after it meets U.S. generally accepted accounting principles.

"The world is afraid of the U.S. moving to IFRS," said one panelist. What are other countries worried about? Namely, that the estimated 2,500 pages devoted to IFRS will inevitably turn into the roughly 25,000 pages filled by U.S. GAAP once the Americans are done with it. The feeling is tantamount to "leave our IFRS alone."

Indeed, U.S. rule makers are concerned that IFRS, with its principles-based standards and adherence to more of a judgment-based framework, is going to leave many U.S. accountants scratching their heads and asking for guidance. They're used to getting pages and pages of intricate regulations and guidance from the Financial Accounting Standards Board and the American Institute of CPAs. But will the International Accounting Standards Board be ready to go into the kind of mind-numbing detail that's become a necessity for many U.S. accountants, while simultaneously being the bane of their existence?

One of the demands is sure to come from accountants who want more industry-specific guidance. IFRS hasn't been terribly particular about individual industries, unlike U.S. GAAP. And it may be too much to ask of U.S. accountants to completely abandon the guidance they have sought on complex industries such as financial services, oil and gas, and utilities, and simply adopt an approach that would more or less apply to any industry, from toys to trucking.

Whittling down the pile of pages devoted to issues such as revenue recognition is not going to be easy. And some IFRS proponents fear a pushback from U.S. accountants, whose version of GAAP has influenced other countries, including our northern neighbor Canada.

Let's face it. The U.S. has an image in many other countries of being a little aggressive. And it may be inevitable that IFRS will evolve as GAAP has, with greater specificity and more pages of detail to satisfy accounting firms with questions about what to do in a given situation. Let's just hope that as the two sets of standards evolve and converge, they will keep the best elements of both without leading to undue complexity and headaches for the profession.


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