Americans have always viewed themselves as the professionals who have always set the standards for financial reporting and have historically taken the role of mentor and leader to the broader global finance community.  However, that role looks to be getting turned on it’s head pretty rapidly with the impending conversion to new emerging global accounting standards, which as a surprise to some, is coming out of Europe.

     For the last two years at my previous company we made the move to an IFRS (International Financial Reporting Standards) reporting format to conform to the requirements of our French-based parent.  This was a lengthy process as there was a very comprehensive rollout to all the international entities for the adoption of this new format, which was then followed up by “training camps” where all the entities converged for a one-week intensive on the new format.  As the reporting structures were further defined and rolled out there was the necessary dual reporting format where we submitted our standard historical formats, along with the new IFRS formats, along with all the appropriate bridges to outline the differences between the two formats.

     Never did I think that the work that we were doing on behalf of our French parent might become the standard for North American reporting.  Our initial view, along with the view of many of my colleagues, was why don’t the Europeans roll out GAAP in Europe since this is already a standardized form of reporting, has numerous boards to address the constant market changes and update reporting, and a format that was respected globally?  Why invest such a huge volume of labor and monetary resources to something that already exists?

     If you’re not already familiarizing yourself with the new international standards that are dominating current discussions it’s probably about time you start.  I’ll spend some more time in the coming weeks discussing this topic in more detail and the differences between GAAP and IFRS, along with the additional changes that are being considered.

Be ready to go International….even if you’re not traveling!

Thanks for reading.

Jeffrey