Wednesday, February 24, 2010

SEC Reaffirms, Contingent On 'Workplan' and Convergence, Will Decide On IFRS in 2011

At an open commission meeting earlier today, the U.S. Securities and Exchange Commission voted unanimously to issue a Statement:
  1. reaffirming the Commission's support for a single, globally accepted set of accounting standards,
  2. describing issues that need to be analyzed, falling under six categories, in an SEC "Workplan," and
  3. describing events that need to occur between now and 2011, including by the SEC's study of certain issues identified in the "Workplan," and completion of the convergence projects on the FASB-IASB Memorandum of Understanding (MOU), to faciliate the SEC's decision in 2011 on whether to incorporate IFRS in the U.S. financial reporting model for SEC issuers. (NOTE: we corrected earlier version of this sentence for typos.)

SEC Chairman Mary L. Schapiro said that although "we do not have all the information" to make the decision on wheter to move to IFRS at this time, "we remain on a steady path to make the decision in 2011."

SEC Chief Accountant Jim Kroeker added, "The Statement notes, if it is determined in 2011 to incorporate IFRS [into the U.S. financial reporting system], the transition for U.S. issuers would be approximately 2015 or 2016." ** UPDATE: According to the SEC's press release issued this afternoon: "[I]f the Commission determines in 2011 to incorporate IFRS into the U.S. financial reporting system, the first time that U.S. companies would report under such a system would be no earlier than 2015. The Work Plan would further evaluate this timeline."

Read more about the six categories in the SEC's Workplan, and the SEC's view on the role of the FASB in the event the SEC decides to incorporate IFRS into the U.S. system, in this FEI Summary. We anticipate to post additional information later today, in the summary on FEI's website, and in a subsequent blog post.

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