Rules seem onerous until you contemplate life without them. That seems to be one message uncovered in a survey of more than 200 CFOs and senior comptrollers recently conducted by accounting firm Grant Thornton. Asked whether today's financial statements are too complex for the average investor, a solid majority said yes. A slim majority thought that principles-based standards that allow for professional judgment (that is, international financial reporting standards, or IFRS) would be superior to the current system of rules-based standards that offer plenty of detailed guidance (U.S. generally accepted accounting principles, or GAAP). But few companies have experience in preparing financial statements based on IFRS, and only a quarter agree with the Securities and Exchange Commission's decision to allow foreign companies listed on U.S. exchanges to file statements in IFRS with no reconciliation to U.S. GAAP.
Reader CommentsDisplaying 3 of 4
Roland Cycan
Jun 27, 2008 9:51 AM ET
adding to the prior comment
Not only is it the fault of the rule maker if the rules are followed and the product makes no sense, it is also the … more
Roland Cycan
Jun 27, 2008 9:48 AM ET
the fault of the rule maker
GAAP long ago drove preparers out of the mindset of preparing meaningful financial statements. Now the preparers just … more
Joe Jefferis
Jun 9, 2008 11:10 AM ET
Question Authority
How does one go about questioning the decisions of internal leaders who may have reason to make the financial … more
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