The paper focuses on the planning process necessary for companies to implement the right technology systems, processes and controls to ensure a smooth transition to IFRS.
It warns that viewing IFRS simply as a reporting change can lead to a costly rework at a later date, result in cumbersome processes and increase control requirements.
Deloitte US IFRS Solutions Center leader DJ Gannon commented: “Adoption of IFRS is not just about understanding technical accounting differences. Companies will need to understand the impact such differences have on technology and information systems.”
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Deloitte IFRS Solutions Center principal Glen Feinberg added: “IFRS adoption generally can’t be accomplished by finance alone. Technology executives and their functions should be brought into the visioning and planning stages early in order to avoid a potentially costly rework at a later date.
“As adoption rules outside of the United States are running on various timetables, it is also important to have a global strategy around adoption to avoid reimplementation for international sites once the US organisation determines its approach.”
The Deloitte paper, Technology Implications of IFRS Adoption for US Companies, advises companies to take four steps in preparation for IFRS. These include identifying all internal and external data sources that need to be migrated and assess required enhancements to legacy systems; assessing high-level changes to a company’s chart of accounts based upon differences between IFRS and local US GAAP; and analysing the reconciliation process between subledgers and the general ledger with attention to journal entry methods and templates.