Opportunities Abound for IFRS-Trained Accountants
Business has become global. But in order to conduct cross-border business, there must be a common set of regulations throughout the world. And industry leaders around the world are pushing for just that. A recent survey of accounting executives conducted by the International Federation of Accountants (IFAC) shows that there is overwhelming support for the convergence of accounting standards. The Institute of Management Accountants (IMA) has also joined a widespread call for the Securities and Exchange Commission (SEC) to accept financial reports prepared under international accounting standards without reconciliation with U.S. GAAP.
Meanwhile IFAC research shows that global accountancy leaders, facing pressing staff shortages, will also focus on attracting new accounting talent to their ranks. Now, in an increasingly global financial community, candidates seeking accounting jobs stand to benefit from an international perspective. Executive search firm, A.E. Feldman, says the number of accounting jobs for IFRS-trained professionals is increasing, and the growing pool of accounting talent is creating expansion opportunities for a number of U.S. firms.
A recent IFAC survey of 143 accounting industry leaders from 91 countries finds that 89% of those polled believe convergence to International Financial Reporting Standards (IFRS) is “very important”or “important” for economic growth in their countries. In response to the results, one of the survey respondents, Barry Melancon, President and CEO of the American Institute of CPAs (AICPA), said, “The sentiments expressed in the IFAC survey clearly show that convergence is not only desirable, but essential in an economy that is quickly dissolving borders.”
The international convergence of accounting standards is a global trend that began more than three decades ago. Today, as companies vie for overseas capital and investors seek to access foreign markets, the demand for financial reporting standards that transcend national borders is growing. Nearly 100 countries (including the European Union, Hong Kong, Australia, Russia, South Africa, Singapore and Pakistan) require or have a policy of convergence with International Financial Reporting Standards (IFRS).
The SEC has already begun moving towards convergence. Back in November the requirement that foreign companies with U.S. stock market listings reconcile their financial results with U.S. GAAP was eliminated. The unanimous vote immediately affected roughly 1,100 companies with U.S. listings, along with any companies planning U.S. IPOs.
The SEC has stated that it will allow U.S. companies to choose between filing under IFRS or GAAP by 2010 or 2011. SEC Chief Accountant, Conrad Hewitt, put the date on convergence at five to 10 years from now as standard-setters and regulators appear to be taking “small steps instead of a big leap into IFRS,” according to Financial Week.
Switching to IFRS significantly reduces the cost of accounting and financial reporting for multi-national companies, which would otherwise have to translate and reconcile records prepared under various country-specific standards.
The IFAC survey also shows that in 2008 global accountancy leaders will focus on attracting new accounting talent to their ranks. The survey finds the most pressing staff shortages exist in regions such as sub-Saharan Africa, the Middle East, North Africa, and North America. In fact, North American respondents ranked recruitment and retention as the main issue for the coming year.
AICPA Chief, Barry Melancon, however says staffing concerns in the accounting industry will continue well beyond 2008. “In the next 15 years, 75 percent of the AICPA’s member will reach or approach retirement age. Filling the pipeline of new accountants will be a strategic priority of the U.S. profession for years to come.”
