The International Financial Reporting Standards (IFRS) is a set of guidelines developed by the International Accounting Standards Board (IASB). Though the United States currently operates under the Generally Accepted Accounting Principles (GAAP), more than 100 countries have implemented IFRS.
While the Securities and Exchange Commission (SEC) has not yet made a decision on whether to require adoption of IFRS in the United States, Chad Schafer, Kforce SEC Reporting Manager, says this set of standards continues to become globally accepted for the preparation of public company financial statements.
“Additionally, the adoption of IFRS will likely create job opportunities during the planning and transition phase as companies assess its impacts, apply standards and modify processes around data collection, accounting, reporting and budgeting,” says Schafer.
Read the SEC’s Latest Comparison of GAAP and IFRS
As a firm specializing in finance and accounting staffing, Kforce frequently works with financial companies skilled in IFRS practices such as Grant Thornton. Nate Vander Hamm, Grant Thornton IFRS National Practice Leader, says as a result of the impending changes, the following finance-related professionals should become familiar with IFRS:
- Certified public accountants (CPAs)
- Financial statement preparers
- Financial investment professionals
- Credit and collections specialists
- Tax managers
- Business valuation professionals
- International tax professionals
“Any role in accounting and finance could change,” says Vander Hamm. “If the SEC moves forward with IFRS adoption, the first thing public companies would need are accountants who understand IFRS. Anyone who performs evaluations of companies, including analysts, could be affected.”
Furthermore, a conversion to IFRS in the U.S. is likely to create a need for new or additional resources within public companies. Staffing firms, such as Kforce, and many financial companies may not only look for professionals experienced in IFRS, but those who can train other employees.
“While we may not see entirely new careers open up, I think in the short term, there could be some companies that need to find additional financial professionals to supplement their current accounting group with knowledge of accounting, internal controls, and the COSO (Committee of Sponsoring Organizations) framework, creating a number of job opportunities,” says Vander Hamm.
For the many financial professionals in the U.S. currently practicing under GAAP, a transition to IFRS could become a challenge. The bigger concern is ‘how well can those professionals adjust?’
While the SEC has indicated there will be a minimum of four to five years for adoption if a decision is made to adopt IFRS in the United States, it is never too early to become familiar with these standards. Schafer says finance and accounting departments will require the strongest knowledge of IFRS to properly apply the complexities of its standards.
Vander Hamm adds, “At a minimum, financial professionals should at least begin to understand the differences between GAAP and IFRS. There are a lot of different options for identifying training, some at a low cost, because it is such a high area of interest.”
A few areas and topics of training can include the following:
- Introduction to IFRS
- IFRS guidelines vs. U.S. GAAP
- Analyzing financial statements in accordance with IFRS
- Standardized reporting in an international environment
While there are a number of self-study and online programs offering both knowledge and certification, it is most important to apply the knowledge learned on IFRS.
“Education by itself isn’t the only piece of training,” says Vander Hamm. “Those who are able to work for companies implementing IFRS can become a more marketable candidate for a new position if they have practical experience and are able to apply what they have learned about IFRS.”
As financial professionals anxiously wait on the decision of the SEC on whether or not to move forward with IFRS, Vander Hamm says it is clear that many of these professionals should be prepared for what is ahead.
“There is a lot of anticipation that the SEC will move forward with IFRS, but the timing and the method of adoption is uncertain at the time,” says Vander Hamm. “The rest of the world is already on IFRS or moving in that direction and the U.S. is becoming more and more of an outlier.”
Learn more about IFRS training with Grant Thornton and how to receive a 10% discount.