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*IFRS 15 implementation issues 2015
Why KPMG ??How convergence may impact you?Convergence of Local
GAAP to IFRS
The need for transition:
In the wake of emerging and ever-developing
accounting and financial reporting landscape,
together with the global acceptance of the
International Financial Reporting Standards (IFRS), it
has recently been decided by SOCPA to commence
a project for reviewing and assessing existing
SOCPA standards in light of the relevant IFRS. The
fact that KSA was the only country within G20 with
neither IFRS adoption nor a road-map to conversion.
The conversion project:
Consequently, a road map for convergence was
developed with an emphasis that due consideration
should be given to environmental factors and
economic conditions in Saudi Arabia, and that
transition should be applied ensuring sufficient time
to all stakeholders to get themselves professionally
and technically ready for smoother transition.
In accordance with the approved convergence plan, all
Saudi Listed Entities are required to adopt IFRS for
financial periods commencing on or after January 1,
2017 and other companies will follow the convergence
in the following year.
Assess
Impact of
conversion
Discuss results of
initial assessment
of impact
Update
qualitative
discussion
Start
first
IFRS
year
First IFRS
A/R
Financial
statements
First
Interim
Financials
on IFRS
Refine and
monitor IFRS
reporting process
31/12/17
Reporting
Date
Design
&Implementation of
conversionHold
educational/
informational
discussions
regarding
IFRS with
management
Parallel
processing
under IFRS and
SOCPA
Comparative year on IFRS
basis Year of Adoption
01/01/2016
Transition Date
– preparation
of consolidated
IFRS opening
balance sheet
IFRS 1 : First
Time Adoption
Standards
*A/R – annual report
** Companies would need to start preparing IFRS
Interim financial statements in Q1 2016 in order to
have comparative figures for the 2017 financials. In
2016, companies would still issue SOCPA interim
financial statements for Q1 through Q3.
Key assumptions in timeline estimate:
Impact assessment : 3-6 months (based on scale and
complexities in business)
Discussion of impact assessment results : 1-3 months
IT System changes: 3-6 months
Opening balance sheet preparation : 2-3 months
31 Dec 2017
2017 A/R *2016 A/R *
31 Mar 201731 Dec 201630 Jun 201631 Dec 20151 Sept 2015
Dry run
conversion for
2016 IFRS
comparative
info.
Our existing clients
Critical
Success
Factors
Comprehensive Project – Accounting,
Business, IT
Policy election & IFRS 1
Transfer of Knowledge to Internal Team
Involvement of Senior Management at periodic intervals
Involvement of teams from different geographies
Right project management office –
Auditor, IFRS Team etc
Imparting technical training to resources
Consider bandwidth of internal teams
Coverage of all material locations
for assessment
Top management sponsorship of the
project
Starting Early
How KPMG can help?- Analyzing and identifying the differences
