Experiences from across the pond
Ten lessons from European IFRS conversion in the Real Estate industry
There has been a significant level of speculation regarding the future of the US accounting framework ever since the proposed roadmap for the mandatory adoption of International Financial Reporting Standards (IFRS) for public companies was issued. Detractors have critiqued the IFRS framework for its lack of rigor compared with the US GAAP, and highlighted its failure to enhance comparability. The potential costs of conversion and the distraction that IFRS may cause – at a time when focus on financial reporting rigor and quality of reporting to stakeholders are key – are top concerns.
It is vital that the maximum value is extracted from every aspect of the effort put into planning and executing the conversion process. To achieve this, the European experience of the IFRS implementation can be leveraged effectively by U.S. Real Estate companies to help minimize the potential cost burden of the conversion process.
The reception of IFRS in Europe (implemented in 2005) has been positive with many stakeholders believing that IFRS has led to improved quality in financial reporting when compared to other accounting frameworks. The experience in Europe has provided practitioners with a mature perspective on taking a smart route through the transition period and the pitfalls on the way, conducting an efficient and effective transition, and securing long term financial reporting process efficiency.
Following Deloitte’s recent IFRS summit, our report, “Experiences from across the pond: Ten lessons from European IFRS conversion in the Real Estate industry,” provides ten key lessons from Deloitte’s European experience of IFRS conversion for Real Estate investors and developers.
To read the full report, click here.