Mum Overview of IFRS NP Sarda

8/3/2019 Mum Overview of IFRS NP Sarda

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IFRS in India

Deloitte Haskins & Sells, Mumbai

DeloitteHaskins & Sells

ASSOCHAM Master ClassOn IFRS

Hyderabad ,June 25, 2010


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Agenda

Global Convergence of AccountingStandards

IFRS Standards

Convergence of Indian AccountingStandards with IFRS

IFRS Resources IFRS Vs Indian GAAP major items

(separate presentation).

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GLOBAL CONVERGENCE

ofACCOUNTING STANDARDS

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Convergence Drivers

Capital Markets

Regulatory requirements

Internal controls

Performance evaluation

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IFRS Objective

Principles based high quality globalstandards

Emphasis on relevance and disclosures

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IFRS Adoption

Approximately 100countries haveadopted or are in the

process of adoption Status of adoption by

some countries whichcompete with India for

capital allocation:

China Similar to IFRS(effective forlisted entities2007)

Brazil 2010

Russia Currentlyapplicable forbanks.

South Korea 2011

USA 2014/15/16

UK 2005

Nepal 2011 (as per actionplan released)

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Europe moved to IFRSs from 1/1/2005 withabout 8000 EU listed companies mandated

Non-EU listed companies allowed to use GAAPsof US, Japan, China, S Korea, and India, othercountries to use IFRS Review in 2011

EU member states may require IFRSs for non-listed companies and to separate company

statements European Commission has so far endorsed all

IASs, IFRSs and all interpretations (except some recentamendments)

Use of IFRSs in Europe


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Use of IFRSs in Canada

Currently Canadian companies listed in USmay use US GAAP for domestic reportingand foreign issuers are allowed to use

IFRSs From 1 January 2011, all Canadian public

entities must use IFRSs

Early adoption is permitted on case-by-case basis by securities regulator

Not-for-profit and pension plans are not

required to transition to IFRSs


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IFRS Adoption

BIGGEST STAMP OF APPROVAL

Securities and Exchange Commission (SEC),

United States of America have permitted ForeignPrivate Issuers to file IFRS compliant financialstatements (as promulgated by the IASB)without reconciliation to US GAAP

SEC has issued a proposed roadmap to assesswhether US domestic registrants should bepermitted to use IFRS

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SEC permits IFRS filings

SEC now permits foreign private issuers tofile their financial statements prepared underIFRS in stead of US GAAP without the

need for reconciliation In November 2008, SEC revised itsroadmap to include milestones that could

lead to mandatory transition to IFRSs startingfiscal years ending on or after 15 December2014/15/16, with permission to certainentities to adopt early.


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SEC permits IFRS filings

SEC has issued a roadmap proposing the useof IFRS by

Large Accelerated filers for fiscal year

ending on or after Dec 15, 2014.Accelerated filers for fiscal year ending onor after Dec 15, 2015Non-accelerated filers for fiscal year

ending on or after Dec 15, 2016

IASB FASB integration project


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The Global Move Towards IFRS

Europe2005

Australia2005

Canada2009/11

South Africa2005

United States(2014/15/16?)

Current or anticipated requirementor option to use IFRS (or equivalent)

Brazil

2010

China2007

India2011

Chile2009

Japan(2016)


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In October 2007, ICAI issued concept papergiving the approach and roadmap forconvergence

Various study groups have been formed

The convergence exercise will be taken upin phases - listed and bigger companies

initially, smaller public companies thereafter,and eventually all private companies/SMEs

Convergence Project in India


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The ministry of Company affairs hasappointed two working groups, headed byMr. Y.H. Malegam and Mr. Mohandas Pai tofinalise the roadmap to IFRS convergence.

SEBI Committee on Disclosures andAccounting Standards (SCODA) is the

standing Committee - Voluntary adoption ofInternational Financial Reporting Standards(IFRS) by listed entities having overseas

subsidiaries or by all listed entities.

Convergence Project in India


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IFRS in India

On April 5, 2010 Amendment to listingAgreement provides the option of adoptionof International Financial Reporting

Standards (IFRS) by listed entities havingsubsidiaries while declaring Consolidatedresults/financial statements

Standalone results will be as per theexisting Indian GAAP


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IFRS in India

On January 22, 2010 MCA has releasedRoad Map for convergence with IFRSFor large Companies


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IFRS in India Phase I

The following categories of companies will converttheir opening balance sheets as at 1st April, 2011, ifthe financial year commences on or after 1st April,

2011 in compliance with the notified accountingstandards which are convergent with IFRS. Thesecompanies are:-

a. Companies which are part of NSE Nifty 50

b. Companies which are part of BSE - Sensex 30c. Companies whose shares or other securities are

listed on stock exchanges outside India

d. Companies, whether listed or not, which have a net

worth in excess of Rs.1,000 crores.


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IFRS in India Phase II

The companies, whether listed or not, havinga net worth exceeding Rs. 500 crores but notexceeding Rs. 1,000 crores will convert their

opening balance sheet as at 1st April, 2013, ifthe financial year commences on or after 1stApril, 2013 in compliance with the notifiedaccounting standards which are convergentwith IFRS.


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IFRS in India Phase III

Listed companies which have a networth of Rs. 500 crores or less will

convert their opening balance sheet asat 1st April, 2014, if the financial yearcommences on or after 1st April, 2014,whichever is later, in compliance with

the notified accounting standards whichare convergent with IFRS.


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IFRS in India Road map

When the accounting year ends ona date other than 31st March, the

conversion of the opening BalanceSheet will be made in relation to thefirst Balance Sheet which is made

on a date after 31st March.


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Companies which fall in the following categories willnot be required to follow the notified accountingstandards which are converged with the IFRS (though

they may voluntarily opt to do so) but need to followonly the notified accounting standards which are notconverged with the IFRS. These companies are: -

(a) Non-listed companies which have a networth of Rs. 500 crores or less and whose shares orother securities are not listed on Stock Exchangesoutside India.

(b) Small and Medium Companies (SMCs).


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The draft of the Companies

(Amendment) Bill, proposing for

changes to the Companies Act, 1956will be prepared incorporating therecommendation of Sub-Group 1Report.


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Revised Schedule VI to the Companies

Act, 1956 according to the converged

Accounting Standards has beensubmitted by the ICAI to NACAS which,after review, will submit to the Ministry.Amendments to Schedule XIV will alsobe made in a time bound manner.


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In respect of the converged AccountingStandards, the Chairman of the AccountingStandards Board of ICAI will submit the

converged version of Accounting Standards toNACAS from time to time for recommendationsand onward submission to Ministry.

However, convergence of all the accounting

standards will be completed by ICAI andNACAS will submit its recommendations to theMinistry.


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Roadmap recommended by Core Group ofMCA in respect of insurance companies,banking companies and non-banking finance

companies. Insurance companies:-

All insurance companies will convert their

opening balance sheet as at 1stApril, 2012 incompliance with the converged IndianAccounting Standards.


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Banking companies:-

(a) All scheduled commercial banks andthose urban co-operative banks(UCBs) which

have a net worth in excess of Rs. 300 croreswill convert theiropening balance sheet as at1st April, 2013 in compliance with the first set

ofAccounting Standards (i.e. the convergedIndian Accounting Standards).


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Banking companies:-

(b) Urban co-operative banks which have anet worth in excess of Rs. 200crores but not

exceeding Rs. 300 crores will convert theiropening balance sheets as at 1st April, 2014in compliance with the first set of Accounting

Standards (i.e. the converged IndianAccounting Standards).


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Banking companies:-(c) Urban co-operative banks which have anet worth not exceeding Rs. 200crores and

Regional Rural banks (RRBs) will not berequired to applythe first set of AccountingStandards i.e. the converged IndianAccounting Standards(though they may

voluntarily opt to do so) and need to followonly the existing notified Indian AccountingStandards which are not converged withIFRSs.


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IFRS in India Road map NON-BANKING FINANCE COMPANIES

Type of institution Opening B/s conversion date

Companieswhich are part of NSENifty 50Companies & which are part

of BSE - Sensex 30Companies, whether listed or not,which have a net worth in excess ofRs.1,000 crores.

April 1, 2013

All listed NBFCs and unlisted NBFCswhich do not fall in the abovecategories and which have a networth in excess of Rs. 500 crores

April 1, 2014


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IFRS in India Road map NON-BANKING FINANCE COMPANIES

Unlisted NBFCs which have a net worth of Rs. 500crores or less will not be required to apply the

converged Indian Accounting Standards.


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Clarification issued MCA on the

certain issues in the Roadmap

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MCA Clarifications The Ministry of Corporate Affairs issued

clarification on the following issues in theIFRS Roadmap on 4th May 2010: Determination of Applicability

Applicability for entities that are subsidiaries, jointventures or associates of companies coveredunder the convergence roadmap.

Discontinuing use of the first set of AccountingStandards (Converged Accounting Standards)

Calculation of net worth

Removal of options32


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MCA clarifies on: Determination of Applicability

Whether companies can voluntarilyopt to provide comparative figures for

2010-11 in accordance with the

converged Accounting Standards?

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Previous year figures - Clarification:

Companies should show previous years figures as perthe F/s for 2010-11.

Option available to add an additional column to indicatewhat the figures could have been if the Converged

Accounting Standards had been applied in the previousyear

Companies which make this additional disclosure, forthis purpose, convert their opening balance sheet as the

date on which this pervious year commences and inthat case, a further conversion of the opening balancesheet for the year for which the F/s are prepared will notbe necessary.

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Whether companies covered in 2nd / 3rdphase for application of the converged

Accounting Standards can voluntarily opt toapply the same w.e.f accounting yearbeginning 1st April 2011?

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Clarification:

Companies in the 2nd / 3rd phase will havean option for application of the ConvergedAccounting Standards only for thefinancial year commencing on 1st April2011 or thereafter

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What is the cut-off date on which thecriterion set out in the roadmap shall beapplied in order to determine the

companies falling in each of the fourcategories which will convert their openingbalance sheet as at 1st April 2011 in

compliance with the converged accountingstandards

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Clarification:

The date of determination of the criteria isthe Balance Sheet as at 31st March 2009;

OR

the first Balance Sheet prepared

thereafter when the accounting year endson another date.

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What is the cut-off date on which the criterion setout in the roadmap shall be applied in order todetermine the scheduled commercial

banks/urban co-operative banks/NBFCs falling ineach of the categories (as set out in the roadmapfor Banks and NBFCs) which will convert theiropening balance sheet as at 1st April 2013 in

compliance with the converged AccountingStandards?

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Clarification:

The date of determination of the criteria is theBalance Sheet as at 31st March 2011;

OR

the first Balance Sheet prepared thereafterwhen the accounting year ends on another

date.

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MCA l ifi St t f b idi i JV d


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MCA clarifies on: Status of subsidiaries, JVs andAssociates of entities who are covered under

roadmap

Whether it would be permissible for thecompanies which are not individually covered

under the phasing plan for application of theConverged Accounting Standards to voluntarilyopt for application of the Converged standardseven for their standalone F/s?

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MCA clarifies on: Status of subsidiaries, JVs and


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MCA clarifies on: Status of subsidiaries, JVs andAssociates of entities who are covered under

roadmap

Clarification: Criteria to be considered for each companys standalone

accounts

Companies covered in a particular phase having

subsidiaries, JVs or associates not covered in those phaseswill prepare consolidate F/s according to ConvergedAccounting Standards

One of more companies in a group will continue to prepare

F/s in accordance with the Accounting Standards applicableto the particular phase to which it belongs but parent willneed to make amendments to these accounts in order toconsolidate as per Converged Accounting Standards

Such subsidiaries, JVs or associates may have the option to

early adopt the Converged Accounting Standards.42

MCA l ifi Di ti i f


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MCA clarifies on: Discontinuing use ofConverged Accounting Standards

Does a company have the option to go back topreparing F/s in accordance existing IndianAccounting Standards if it no longer satisfies thespecified criteria in the future?

Clarification: No.

Once a company starts following the Converged

Accounting Standards on the basis of the eligibilitycriteria, it will be required to follow such AccountingStandards for all the subsequent financial statementseven if any of the eligibility criteria does notsubsequently apply to it. 43


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MCA clarifies on: Calculation of Net worth

Rules for calculation of qualifying net worth

Clarification:

Networth will be calculated as per audited balance sheet

of the company as at 31st March 2009 or first balancesheet for accounting periods which ends after that date

Networth = Share Capital + Reserves RevaluationReserves Miscellaneous Expenditure Debit Balance

in Profit and Loss A/c For companies which are not in existence on 31st March

2009, networth will be calculated on the basis of the firstbalance sheet ending after that date.

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MCA clarifies on: Calculation of Networth

Rules for calculation of qualifying networthrecommended to Scheduled Commercial Banks /Urban Cooperative Banks / NBFCs

Clarification:

Networth will be calculated as per audited balance sheetof the Bank / NBFC as at 31st March 2011 or firstbalance sheet for accounting periods which ends afterthat date

Networth = Share Capital + Reserves RevaluationReserves Miscellaneous Expenditure Debit Balancein Profit and Loss A/c

For Banks / NBFCs which are not in existence on 31st

March 2009, networth will be calculated on the basis of45


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MCA clarifies on: Removal of Options

Situation where Notified Converged AccountingStandards ARE NOT fully consistent with IAS /IFRS

Clarification: Companies will follow the first set of Accounting

Standards i.e. the Converged Accounting Standards andNOT IFRS.

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Regulatory updates

Steps to reduce inconsistencies between


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The ICAI has taken the following steps for Identification ofinconsistencies between various Laws and Regulations:

Constitution of a Group on Liaison with Governmentaland Regulatory Authorities

Group has constituted separate Core Groups to identifyinconsistencies between IFRSs and the followingstatutes:

Companies Act

SEBI Regulations Banking Laws & Regulations

Insurance Laws & Regulations(Source: Announcement by the Technical Directorate, The Institute of

Chartered Accountants of India )

Steps to reduce inconsistencies betweenregulations


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MCA Actions

Formation of a Core Group

Formation of Sub-group on Accounting and a

CFO sub-group Public statements by Minister and officials

indicating an increased sense of urgency


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Action Steps

Changes required in legislations

Accounting Standards

standards on new subjects

Conceptual changes

Disclosure changes

Language changes

Training and accreditation

Enabling infrastructure

Regulatory oversight


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Convergence Status

Exposure drafts on most of the convergedstandards have been released for publiccomments by ICAI

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IFRS Hi h


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IFRS Hierarchy International Accounting Standards Committee Foundation.

The body which oversees the International Accounting StandardsBoard.

International Accounting Standards Board (IASB).

The body which sets International Financial Reporting Standards

(IFRS) and approve interpretations

International Financial Reporting Interpretations Committee

(IFRIC).

Responsible for interpretation of standards and issue guidance on

issues that have not yet been addressed by standards.

The Standards Advisory Council (SAC).

Forum to provide broad strategic advice on IASBs agenda priorities

and insight into costs and benefits of projects.


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IFRS Hierarchy Statements

International Accounting Standards (IAS)

International Financial Reporting Standards (IFRS)

Standard Interpretations (SIC)

International Financial Reporting Interpretations(IFRIC)


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IFRS Structure

The term IFRSs currently comprises of: 9 IFRSs, 29 IASs (originally 41), 18 IFRIC and 11

SIC interpretations, plus the Framework

There are 15 new standards and majorprojects for which exposure drafts areissued

Final SME standard was been issued inJuly 2009.

8 existing standards are being amended for

which exposure drafts are issued


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IFRS - Standards

Preface to International FinancialReporting Standards

Framework for the Preparation and

Presentation of Financial Statements


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IFRS Standards Contd.

IFRS 1 First-time Adoption of InternationalFinancial Reporting Standards

IFRS 2 Share-based Payment

IFRS 3(2008) Business Combinations


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IFRS 4 Insurance Contracts

IFRS 5 Non-current Assets Held for Saleand Discontinued Operations

IFRS 6 Exploration for and Evaluation ofMineral Resources

IFRS 7 Financial Instruments: Disclosures


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IFRS 8 Operating Segments*

IFRS 9 Financial Instruments - Assets

* Annual periods beginning on or after 1January 2009. Supersedes IAS 14 fromthat date, or date of earlier application.


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IAS 1(2007) Presentation of FinancialStatements

IAS 2 Inventories

IAS 7 Statement of Cash Flows

IAS 8 Accounting Policies, Changes inAccounting Estimates and Errors


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IAS 10 Events after the Reporting Period

IAS 11 Construction Contracts

IAS 12 Income Taxes

IAS 16 Property, Plant and Equipment


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IAS 17 Leases

IAS 18 Revenue

IAS 19 Employee Benefits

IAS 20 Accounting for Government Grantsand Disclosure of Government Assistance


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IAS 21 The Effects of Changes in ForeignExchange Rates

IAS 23 Borrowing Costs

IAS 24 Related Party Disclosures

IAS 26 Accounting and Reporting byRetirement Benefit Plans


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IAS 27(2008) Consolidated and SeparateFinancial Statements

IAS 28 Investments in Associates

IAS 29 Financial Reporting inHyperinflationary Economies

IAS 31 Interests in Joint Ventures


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IAS 32 Financial Instruments: Presentation

IAS 33 Earnings per Share

IAS 34 Interim Financial Reporting

IAS 36 Impairment of Assets

IAS 37 Provisions, Contingent Liabilities

and Contingent Assets


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IAS 38 Intangible Assets

IAS 39 Financial Instruments: Recognitionand Measurement

IAS 40 Investment Property

IAS 41 Agriculture


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Progress of Convergence


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Current Status

Progress so far Number ofStandards

Standards Cleared by Council 12

Exposure Drafts Issued and CommentsConsidered by ASB

8

Exposure Drafts Issued and Comments

To Be Considered by ASB

18

TOTAL 38

Standards Cleared by Council


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Standards Cleared by CouncilStandard # Standard Description

AS 1 Corresponding to IAS 1, Presentation of Financial Statements

AS 2 Corresponding to IAS 2, Inventories

AS 3 Corresponding to IAS 7, Statement of Cash Flows

AS 4 Corresponding to IAS 10, Events after the Reporting period

AS 5 Corresponding to IAS 8, Accounting Policies and Changes in AccountingEstimates and Errors

AS 7 Corresponding to IAS 11, Construction Contracts

AS 12 Corresponding to IAS 20, Accounting for Government Grants and Disclosureof Government Assistance

AS 16 Corresponding to IAS 23, Borrowing Costs

AS 19 Corresponding to IAS 17, LeasesAS 25 Corresponding to IAS 34, Interim Financial Reporting

AS 34 Corresponding to IAS 29, Financial Reporting in HyperinflationaryEconomies

AS 35 Corresponding to IFRS 6, Exploration for and Evaluation of Mineral

Resources

Exposure Drafts issued and comments


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pconsidered by ASB

Standard # Standard Description

AS 10 Corresponding to IAS 16, Property, Plant and Equipment

AS 11 Corresponding to IAS 21, The Effects of changes in ForeignExchange rates

AS 18 Corresponding to IAS 24, Related Party Disclosures

AS 20 Corresponding to IAS 33, Earnings Per Share

AS 21 Corresponding to IAS 27, Consolidation and Separate FinancialStatements

AS 23 Corresponding to IAS 28, Investments in AssociatesAS 29 Corresponding to IAS 37, Provisions and Contingent Liabilities

and Contingent Assets

AS 37 Corresponding to IAS 40, Investment Property

Exposure Drafts issued and comments to beid d b ASB


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considered by ASB


AS 9 Corresponding to IAS 18, Revenue

AS 14 Corresponding to IFRS 3, Business Combinations

AS 15 Corresponding to IAS 19, Employee Benefits

AS 17 Corresponding to IFRS 8, Operating Segments

AS 22 Corresponding to IAS 12, Income Taxes

AS 24 Corresponding to IFRS 5, Non-current Assets Held for Sale andDiscontinued Operations

AS 26 Corresponding to IAS 38, Intangible Assets

AS 27 Corresponding to IAS 31, Interest in Joint Ventures

AS 28 Corresponding to IAS 36, Impairment of Assets

Exposure Drafts issued and comments to be


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considered by ASB


AS 30 Corresponding to IAS 39, Financial Instruments: Recognition andMeasurement

AS 31 Corresponding to IAS 32, Financial Instruments: Presentation

AS 32 Corresponding to IFRS 7, Financial Instruments : Disclosures

AS 33 Corresponding to 2, Share-based payment

AS 36 Corresponding to IAS 26, Accounting and Reporting by RetirementBenefit Plans

AS 38 Corresponding to IAS 41, Agriculture

AS 39 Corresponding to IFRS 4, Insurance Contracts

AS 40 Corresponding to IFRS 9, Financial Instruments

AS 41 Corresponding to IFRS 1, First time Adoption of InternationalFinancial Reporting Standards


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IFRS CONVERSION ISSUES

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Business and organisational considerations


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gIFRS impact beyond financial statements

Most aspects of the business

can be affected: Processes and systems

Operations

Tax

Treasury

Examples include impact on:

Debt covenants

Compensation plans

Revenue contracts

Joint ventures andalliances

Investor communication

The adoption of IFRS affects more than acompanys accounting policies, processes, and

people.

Ultimately, most aspects of a companys businessand operations are affected potentially.


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Treasury ManagementHedge Accounting

Investments

ValuationFair valuation approach

Fair valuation methodologies

Distribution2010-11 profit will change

Dividend policy

Debt CovenantsIAS 1 requirements

Mergers &Acquisitions

ControlGoodwill

Capital reserveIFRS 1 option

ManagementCompensationESOP fair value

Targets not achievableDirector remuneration

InvestorsTax Implication

Fair value adjustmentMost item will flow

through P & L

MISIncreased volatility

Fluctuations outsidecontrol

Fair value adjustment

HRTraining

Revised CTC

IT SystemsDisclosures (IFRS 7)

Hedge accountingData collection

Investorrelations

Changes in EPSEU experience

ORGANISATION

IFRS Implementation Issues

Potential business issues


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Potential business issues Some of the key business issues that will need to

be addressed for successful implementation: Treasury management

Distributions

Debt covenants & financing

Mergers & acquisitions Management compensation

Potential tax implications

Management information

Human resources & training

IT systems

Investor relations75



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Treasury management

Certain financing and hedging policies will no longerachieve the desired accounting effect, will instead createvolatility in reported profits

Challenge

have to find good economic strategies that will produceright accounting treatment

Distributions

Equity will change current dividend policy may nolonger be sustainable

Altered dividend patterns may directly impact the shareprice

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Potential business Issues


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Potential business Issues

Debt covenants & financing

Where debt covenants do not provide for changes inaccounting standards, changes to financial position maycause these covenants to be breached

Impact companys ability to ensure continuity of financing

arrangements

When seeking to raise finance, comparative figures mayneed to apply IFRS as well

Mergers & acquisitions

Accounting for potential acquisitions will be altered by theadoption of IFRS

Goodwill => become non-amortised

Past mergers/acquisitions may contain clauses includingprice revisions based on accounting data 77



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Management compensation

Fair value of share options and other incentive plansshall be recognised

Additional cost to company

Any adjustment to a directors remunerations scheme isa sensitive issue

Careful management of investor relations is essential

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Potential tax implications

Definition of taxable profits, follow accounting rules?

Major accounting principles adopted:

Mark-to-market basis for valuation

Flow through P&L accounts for most items

Both unrealized gains and loss will appear in profitand loss account

Items may cause material impact:

Financial instruments

Share-based payments

Investment properties

Income taxes

Revenue recognition


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Management information

Forecasts and internal performancemeasurements may no longer be comparablewith results reported in FS (eg fair value change)

Making forecast more difficult

Human resources & training

Training will be required throughout the

organization, but not just for finance dept Existing skills may not be adequate to tackle

IFRS related issues need to besupplemented externally or by recruitment


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IT systems Systems that will be affected:

internal and external reporting systems, accountingsystems and operating systems

E.g. new accounting treatments for financial instrumentsmay require treasury systems to be integrated withfinancial reporting system


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Investor relations

May challenge the changes in profits and EPS

Investors will form their own expectation on newaccounting policies and expect certain accountingoutcomes

Nobody likes surprises

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Planning for IFRS


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Planning for IFRS

Technical Accounting

Tax

Internal Processes and Statutory Reporting

Technology Infrastructure

Organizational Issues

Implementation strategy and timeline

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IFRS Conversion Approach


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Determine business case & futurestate vision for IFRS adoption

Perform comprehensive IFRS

conversion

Enable continued IFRS reporting

and perform knowledge transfer



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Assess

ppAn IFRS assessment and conversion utilizes a three-phase approach

Key Tasks

Key

Deliverables

Objective

Analyze impact of IFRS statutory and

regulatory requirements

Determine tax reporting & method

implications of IFRS adoption Analyze impact to accounting,

reporting, close consolidation, and

reconciliation processes and controls

Evaluate the impact upon financial

systems and architecture

Assess magnitude of change upon

stakeholders and operating model

Technical Accounting Country

Assessment

High Level Tax Impact Assessment

Current State Process and Controls

Assessment

Current State Systems Assessment

Business Case and Roadmap

Convert to IFRS at the consolidated

and/or statutory reporting level

Perform tax conversion

Design future state accounting,reporting, close consolidation, and

reconciliation processes and controls

Design future state IT systems to

incorporate IFRS reporting

Develop change management

strategy and revised operating model

IFRS Accounting Policies and

Procedures

IFRS Compliant Reports

Future State Process Flows and

Narratives

Change and Risk Mitigation Plan

Revised Operating Model

Configure, test, and deliver

production environment and monitor

system enhancements

Execute change managementactivities and implement revised

operating model

Deploy future state accounting,

reporting, close consolidation, and

reconciliation processes & controls

Continue monitoring and application

of the changing standards

environment

Facilitate knowledge transfer for

ongoing IFRS reporting

Finalized IFRS Policies

Revised processes

Training Workshops

Detailed Transition Plan

IFRS Conversion Summary

Determine business case & future state

vision for IFRS adoption

Perform comprehensive IFRS

conversionEnable continued IFRS reporting and

perform knowledge transfer

Convert Sustain

Phase 1 Phase 2 Phase 3

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Steps


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p

Scope theimpact

Think of business

issues

Plan theimplementation

Design and implementsystems

Implement businessdecisions

Parallel run and test

systems

Train staff

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IFRS R


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IFRS Resources

IASB website

http://www.iasb.org/Home.htm

ICAIs website

http://www.icai.org/

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Deloitte IFRSResources

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www.Iasplus.com

1,200 pagesand files,350 mb

of IAS stuff.

89

www.iasplus.com


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Day by day past news back to December 2000 (a new

page updated almost daily);

Detailed summaries of all Standards and Interpretations;

E-Learning modules;

Model IFRS financial statements and disclosurechecklists;

Comparisons of IFRS and various national GAAPs;

Deloitte IFRS publications; andmuch more

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IFRS e-Learning


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e-LearningIAS 40 Home


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page

OverviewFour

scenarios

Assessment

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IFRS in your pocket 2009


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IFRS in your pocket 2009

Free atwww.iasplus.com

93


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Model IFRSFinancial Statementsfor 2009

Free at

www.iasplus.com

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THOUGHT LEADERSHIP


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Experience Learned


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p

Be Strategic. Accounting choices and a principles based approach

provides opportunity.

The business will be impacted. Taxes. Systems. Debt Covenants.Dividends. Earnings. MIS. The reach of IFRS can be widespread.

Execution counts. Understanding concepts is only the beginning.Striking the numbers and documenting your position requires a verylarge effort.

Communication is critical. Internal communication across yourbusiness is needed. External communication with all stakeholders is

important. Dont forget the analysts!

Disclosures require a lot of effort. Dont leave this until its too late.

The information requirements are extensive.

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Summary


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Key considerations for Industries Impact on P&L and Net worth

Market valuation

Global image

More business

True picture IFRS is much more than an accounting

matter.


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Deloitte Haskins & Sells 98

Questions?


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Thank you

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Mum Overview of IFRS NP Sarda

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