ACCT 6230 Week 1&2

Week 2 Assignments-IFRS

DUE DATE: Sunday midnight, submitted in a MS Word or Excel document with filename

format:

Last First_Week X hwk.doc or .xls Make sure your name appears on each page of the

homework using the header function.

I. Homework questions:

1. You are a CFO who wishes to early convert to IFRS. Explain to your CEO and

Board of Directors the benefits from converting (assume that they are a multinational

company currently preparing both GAAP and IFRS statements). Also outline some of

the costs that may be incurred and why you think that it is money well-spent. The

board members, who are not very familiar with the subject, have asked you to help

them understand how the financial statements will differ in appearance and content,

from the GAAP statements they have received from you each quarter. Highlight some

of the formatting differences and explain 3 items that have significantly different

treatment under IFRS than GAAP.

2. Pick a business partner or investor such as a bank, creditor, bond rating agency,

individual or pension fund (basically any external user of the financial statements)

and identify 2 areas of financial statements reported under IFRS that will differ from

GAAP. Explain what the user will have to know about the differences, how it might

impact their analysis of the company and find 2 key ratios that could change.

3. What is the likely future of the FASB once (if) IFRS is adopted in the US?

4. Discuss the impact to the users of financial statements, if publicly traded companies

are required to adopt IFRS, but for some period of time, private companies and non-

profits remain on GAAP. What kind of effect could this have on the credit markets?

How might multiple standards in the US affect the auditing industry?