Hoogervorst: SEC Will Adopt IFRS

(Journal of Accountancy, 24 January 2012)

In Brief: Last week, IASB chairman Hans Hoogervorst expressed his confidence that the SEC will adopt IFRS, stating that he and FASB chair Leslie Seidman believe that the current “convergence” process of individual process is not the best approach. Although he acknowledged that IFRS poses an array of practical challenges for the SEC, Hoogervorst stated that, “The U.S. ultimately will come on board … quite simply, they need us and we need them.”

Our View: IFRS adoption continues to be a pressing topic for many Controllers, and Hoogervorst’s comments highlight the fact that the shape of the final standards is far from certain. As the debate over IFRS adoption continues, companies should be educating their internal stakeholders–including IT, HR, Treasury, Tax, and Investor Relations–on how their functions would be impacted by a migration to international standards. Remember to keep your messages simple, and make sure you clearly illustrate how the relevant convergence-related changes will impact each function directly. Using the same broad presentation or memo for business partners that you used for the board of directors will likely do more harm than good.