If the threshold for modifications to incorporated standards were not set at a level
that ensures such modifications were rare, there could be a risk of developing
"U.S.-IFRS," or a derivation of IFRS, that differs more than insignificantly from
the body of IFRS issued by the IASB. Assuming U.S.-specific modifications
were to occur, there could be increased risk of deterioration of the comparability
of financial statements across jurisdictions. However, this potential would need
to be balanced with the ultimate responsibility of the SEC to protect U.S.
investors and the U.S. capital markets. In developing any U.S. modifications to
IFRS, the FASB or SEC would evaluate the overall benefit to investors that could
result from the modification.
· Retains "U.S. GAAP" as the statutory basis of financial reporting
Although the goal of incorporation of IFRS through the framework would be full
alignment of U.S. GAAP and IFRS, such alignment would be accomplished
through the incorporation of IFRSs into U.S. GAAP, thus retaining "U.S. GAAP"
as the basis of financial reporting for U.S. issuers. This would be significant
following a transition to IFRS because of the current prominence of U.S. GAAP
references in U.S. laws, contractual documents, regulatory requirements and
guidelines, and other similar documents. By retaining U.S. GAAP as the basis of
financial reporting for U.S. issuers, the complexities associated with changing all
of these references to U.S. GAAP would be mitigated. Despite of the benefits
highlighted, it is important to note that a multitude of changes to the underlying
U.S. financial reporting requirements--regardless of the ultimate title of the
accounting framework--would necessitate extensive efforts during transition to
understand the full impact on application of affected U.S. laws, contractual
documents, regulatory requirements and guidelines, and other similar documents.
23
Summary :
· Retains "U.S. GAAP" as the statutory basis of financial reporting Although the goal of incorporation of IFRS through the framework would be full alignment of U.S. GAAP and IFRS, such alignment would be accomplished through the incorporation of IFRSs into U.S. GAAP, thus retaining "U.S. GAAP" as the basis of financial reporting for U.S. issuers.
Tags :
gaap,ifrs,financial,modifications,reporting,documents,basis,could,requirements,issuers,retaining,alignment,similar