Companies will have to wait a little longer to find out whether they’ll ultimately have to start complying with the International Financial Reporting Standards (IFRS).
Staff of the Securities and Exchange Commission (SEC) will need at least “a few additional months” to finish up a recommendation to the commission about whether U.S. businesses should switch over to IFRS rules. That’s according to a recent announcement by SEC Chief Accountant James Kroeker.
Originally, the SEC staff was expected to make its recommendation before the new year, but according the Kroeker, they need more time to make sure everything is done correctly.
In the end, the five SEC commissioners will make the final verdict on whether U.S. businesses should change the accounting standards they use.
Currently, the U.S. uses its own set of standards, the Generally Accepted Accounting Principles (or GAAP) while most other countries use IFRS. Proponents of the switch say IFRS would simplify accounting and make it easier for firms to raise capital across international borders. But opponents believe the change would be extremely expensive — especially for small firms that don’t operate outside of the U.S.