With only seven months to go, some public companies are still uncertain about their readiness for the new International Financial Reporting Standards (IFRS) coming into effect January 1, 2011.
About 16% of Canadian public companies surveyed by the Canadian Institute of Chartered Accountants (CICA) said they are only somewhat likely to be ready to transition their public accounting documents to the new IFRS accounting standard.
Companies with a December 31, 2010 year-end must file their financial statements using IFRS by 2011. Companies with a year-end after December have until 2012 to report using the new standards.
About a third of companies said they are nearing the end of the transition process with about a third saying they are past the halfway point of the transition. About 8% saying they have already completed it. That leaves about 28% who haven’t reached the halfway point.
Ron Salole, CICA’s vice-president of standards, said it’s good news that many companies are comfortable with the transition process, “but lots of work lay ahead for others. Adopters should not underestimate the work that remains in a compressed time frame. The closer the deadline approaches, the louder the ticking clock sounds.”
Companies that are not past the halfway point by now are likely running behind, according to Gord Beal, CICA’s principal of transition to international standards.
“Based on the European experience, IFRS adopters should not make the assumption they will be able to hire consultants to make up for lost time.”
BIV last reported on converting to IFRS in issue 1029, July 14-20, 2009.