The Securities and Exchange Commission is asking the public for feedback on its plans for incorporating International Financial Reporting Standards into the financial reporting system for U.S. issuers.
In one of the notices, the SEC requested public comment on behalf of the staff on three topics: U.S. investors current knowledge of IFRS and preparedness for incorporation of IFRS into the financial reporting system for U.S. issuers; how investors educate themselves on changes in accounting standards and the timeliness of such education; and the extent of, logistics for, and estimated time necessary to undertake changes to improve investor understanding of IFRS and the related education process to ensure investors have a sufficient understanding of IFRS prior to potential incorporation.
In another notice, the SEC requested public comment on three other topics: issuers compliance with contractual arrangements that require the use of U.S. GAAP; issuers compliance with corporate governance requirements; and the application of certain legal standards tied to amounts determined for financial reporting purposes.
In the notices, the SEC is asking more detailed questions such as To what extent and in what ways is the set of accounting standards (such as U.S. GAAP or IFRS) used by a company in its financial reporting significant to an investors decision to invest in that company? and To what extent are investors aware of the potential impact of incorporation of IFRS into the financial reporting system for U.S. issuers that they invest in or follow, compared with current U.S. GAAP?
The SEC has posted its current work plan for the consideration of incorporation IFRS into the U.S. financial reporting system on its website here. To submit comments to the SEC on global accounting standards, click here.
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