SEC Proposal: Abandon US Accounting Rules
What this country really needs is less tranparency in earnings reports, and more wiggle room for corporate reporting:
We are governed by utter idiots . . .
Similarities and Differences: A comparison of IFRS and US GAAP
Click for PDF
"The Securities and Exchange Commission signaled the demise of U.S. accounting standards, kicking off a process Wednesday that could ultimately require all publicly listed American companies to follow an international model instead.
Introduced in two steps, the shift could eventually cut costs for companies and smooth cross-border investing. At the same time, investors worry it will create confusion, especially during the transition. Other critics worry that the international system offers too much wiggle room for companies, compared with the more precise rules enshrined in U.S. standards.
The SEC's proposal would allow some large multinational companies to report earnings according to international accounting beginning in 2010. The SEC estimates at least 110 U.S. companies would qualify based on their market capitalization, among other factors. The agency also laid out a road map by which all U.S. companies would switch to International Financial Reporting Standards, or IFRS, beginning in 2014, at the expense of U.S. Generally Accepted Accounting Principles, the guiding light of accountants for decades.
The proposals will be open for public comment for 60 days and could be finalized later this year."
Anything that artificially boosts earnings is great for America . . .
SEC Moves to Pull Plug On U.S. Accounting Standards
KARA SCANNELL and JOANNA SLATER
WSJ, August 28, 2008; Page A1
SEC May Let Companies Abandon U.S. Accounting Rules
Bloomberg, Aug. 27 2008
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I'd hate to be the one to break it to you, Barry, but there has been a convergence effort vis-a-vis IFRS and U.S. GAAP for years and this is the ultimate destination.
Generally, I find the IFRS to be more strict than U.S. GAAP. You should talk to one of those dreaded CFAs and get briefing on IFRS.
Posted by: matt | Aug 28, 2008 7:10:41 PM
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