SEC work plan for accounting change aims at 2011 decision

The Securities and Exchange Commission has published a first progress report on work that will determine whether the US will join most of the rest of the world in adopting international financial reporting standards. Following completion of the work plan and the convergence projects of the Financial Accounting Standards Board and International Accounting Standards Board, the SEC "will be in a position in 2011 to determine whether to incorporate IFRS into the U.S. financial reporting system". SEC chief accountant Jim Kroeker said: "This progress report emphasizes the importance of transparency in the staff's activities, and can help the public's understanding of the magnitude of this project and the staff's progress." The work plan addresses six key areas:

• Domestic reporting: Sufficient development and application of IFRS for the U.S. domestic reporting system.
  
• Independence: The independence of standard setting for the benefit of investors.
  
• Education: Investor understanding and education regarding IFRS.
  
• Regulation: Examination of the US regulatory environment that would be affected by a change in standards.
  
• Impact assessment: The impact on issuers both large and small, including changes to accounting systems, changes to contractual arrangements, corporate governance considerations, and litigation contingencies.
  
• People: "Human capital readiness," in the SEC's inimitable prose.

There will further interim reports along the way. Oh, and there's a small matter of a Congressional election in early November. A new Congress, especially one full of Tea Party Republicans, might not take too kindly to taking accounting rules imported from abroad.

Source document: The progress report is a 44-page pdf file.