How Will IFRS Affect Tax Practitioners?
Tax Advisor | June 2008 Many companies are in the early stages of considering what impact the transition to International Financial Reporting Standards (IFRS) from U.S. GAAP will have on financial reporting. However, are they also thinking about the impact it will have on tax reporting? While practitioners may have focused on the effect that IFRS’s elimination of LIFO would have, other tax accounting implications must be considered. Panelists at SEC roundtables in December 2007 generally agreed that U.S. domestic companies registered with the SEC should be required to file IFRS financial statements at some point in the future and that the SEC should establish a time frame for implementing the requirement. Accordingly, it appears that IFRS is coming and may be replacing GAAP in the future. IMPACT ON TAX ACCOUNTING METHODS The particular methods of accounting a company uses have many effects outside of financial statements. Consequently, converting financial statements from one reporting
