This thing called IFRS

It turned the financial reporting world upside down - International Financial Reporting Standards.

The international standards for accounting and auditing have been in existence since the 60s, serving as the rudder that steers the direction of the world of financial reporting. But these standards are by far reaching an unprecedented significance as the world moves closer towards international convergence.

One by one, countries from all over make the gradual and painful transition from their existing local standards to IFRS. Other countries are more prepared than others with their respective accounting standards council initiating revisions in their local standards to make it parallel to IFRS.

IFRS shook a portion of the standards’ foundations. I am not privy to the process that went with the finalization of IFRS but the powers that govern the finance world is autocratic. The Council draws up the details while the rest of us wait in anxious anticipation. Suffice to say, IFRS is geared towards fair market value reporting. The Standards also addressed the contentious ‘off-balance sheet’ items arising from derivatives. Off balance sheet no more!

As a corporation that sells financial information, my employer prepared well for the radical changes, making headway in product enhancements and database adjustments. Our production group and technology group had to be up to speed in order to provide subscribers with the latest and most updated information.

With some of the basic accounting rules revised or totally discarded, I had to do a lot reading and studying to ‘update’ myself. Some of my days are spent helping some non- accountants in the team understand the changes.

Change!!! It is all about change and how resilient we need to be. I remember that little (but expensive) book called Who Moved My Cheese. In the age of globalization, we can’t be complacent. We have a choice between becoming like a Hem or a Haw.

IFRS. It is the force that pretty much renders the latest editions of all accounting books obsolete.