International Financial Reporting Standards
Considerations for the Audit Committee Regarding IFRS
- What educational needs and goals does the audit committee have?
- Has the audit committee considered the implications IFRS may have on the financial-expert designation?
- Does the audit committee have an oversight plan for IFRS adoption, including the implementation process?
- How will the audit committee remain informed about changes and the impacts of the company’s IFRS transition?
- How will IFRS adoption affect the duties and responsibilities of the audit committee for internal control and financial statement disclosures?
- Is the audit committee aware of the accounting policy elections and various implications for the organization?
- What are the tax and systems implications of an IFRS implementation?
“Given the global trend toward International Financial Reporting Standards (IFRS), many boards are considering the implications for their organizations. Directors should examine not only the strategic effects of this shift, but also what it means in terms of having well-qualified financial experts with knowledge of IFRS on boards and audit committees. Because audit committees have a fiduciary responsibility to protect the interests of shareholders and oversee the integrity of the financial reporting process, their involvement in the transition to IFRS is essential. In my experience, a successful transition is driven by the development of a carefully considered implementation plan, coupled with active and early board involvement.”
D.J. Gannon, partner, Deloitte & Touche LLP
Learn more about International Financial Reporting Standards services.
Comprehensive and timely international accounting news is provided on this website.
The latest information regarding IFRSs for users of financial statements from the AICPA website, including its IFRS Primer for Audit Committees that provides background on IFRS and a list of recommended questions audit committees should review with management.
As discussed in Dorsey & Whitney LLP's "What's New for the 2013 Proxy Season", many companies that have been filing interactive financial data will be losing their shield from liability for such data. Item 406T of Regulation S-T provides a temporary exemption from liability for interactive data files. Under the item, the exemption applies only to files submitted to the SEC less than 24 months after the company was first required to file the interactive data files with the SEC. Companies approaching the lapse of the exemption may want revisit their internal review and verification processes as a precaution.
Posted with the permission from Dorsey & Whitney LLP, copyright 2013