In May 2014, the IASB (International Accounting Standards Board) and the FASB (Federal Accounting Standards Board) published a joint standard on revenue from contracts with customers. Having a fully converged standard in an area of accounting that affects virtually every company is in itself a major achievement. For other major joint projects, however, it appears that full convergence will not be achieved – e.g. with respect to loan loss impairment, insurance contracts and, as it currently stands, leases.
In addition, differences in existing standards continue. So from where we are now, it seems reasonable to expect that IFRS and US GAAP will continue to be the two predominant – and separate – financial reporting frameworks globally.
At the same time, while the advance of IFRS across the globe continues at pace, the SEC (Securities and Exchange Commission) has not yet decided whether to expand the use of IFRS in the US beyond foreign private issuers. However, the SEC’s chief accountant has stated publicly that we can expect movement in the coming months on whether the SEC intends to further incorporate IFRS into the US financial reporting system.
All of this means that an understanding of the differences between IFRS and US GAAP will continue to be important and of keen interest to preparers and users of financial statements under these financial reporting frameworks. With this in mind, we are pleased to publish our latest edition of IFRS compared to US GAAP.