Blog Post

09 July 2015

DUELING STANDARDS BETWEEN GAAP AND IRFA 

Whether you follow one standard or the other, there is not doubt that our financial systems are globalized and interconnected.  Companies operate across regulatory and jurisdictional lines and accounting and disclosure rules, financial reporting, and oversight agents have a complex job.  However, when we look to these accounting foundations to evaluate the soundness of a company in both the public and private markets, the real value of accounting disclosure is internal.  A Company’s first line of defense and growth is full financial transparency, and only secondarily to show investors, regulators and tax authorities the health of the organization.   SEC Commissioner Kara Stein, in her remarks at a recent breakfast roundtable talks about looking forward to how to coordinate a single set of high quality international accounting standard to reduce risk in the 21st Century. “Geographic boundaries have not contained our markets for some time.  Transactions can be executed in one place, the counter parties can be located in another, and the economic impact sometimes felt in a third place.”