Most companies will be ready to move to international financial reporting standards, but they are not likely to make the switch until they are forced to — even if they are given the option to adopt the rules early, says a new survey of executives responsible for corporate financial reporting. The survey, conducted in August by KPMG and Financial Executives International, polled 900 accounting and financial-reporting executives, 75% of whom say their company will stand pat until the Securities and Exchange Commission requires them to replace U.S. generally accepted accounting principles with IFRS.

In addition, nearly half the respondents expect the SEC to make a decision in 2011 on whether or not to mandate IFRS for U.S. corporations; only 15% do not expect such a vote. A whopping 94% say their organization could adopt IFRS by 2016 if they were told next year to switch from GAAP.

Half of the survey respondents are from publicly held companies, while 24% work at private companies. The remainder are from other organizations such as foreign private issuers or subsidiaries of foreign parent companies. Company sizes range from less than $500 million in revenue to more than $10 billion.

Implementation costs worry 65% of the executives, while a third say their company has not yet assessed how IFRS will affect their organization. Indeed, those who are unsure about the implementation effects say they are waiting to see a proposed or final rule before delving into the details. Meanwhile, 54% are concerned that a more judgment-based set of standards may lead to more second-guessing by the market and regulators.

A significant percentage of respondents, 88%, believe the adoption of IFRS by the United States will enhance the comparability of financial statements around the world. Fifty-seven percent of the respondents say convergence of U.S. GAAP and IFRS is the best approach to IFRS adoption, and 30% are keen to see a definite date established for when the U.S. market would adopt IFRS.

KPMG partner Janice Patrisso, the firm’s national leader of IFRS, notes that while less than half of those surveyed characterize themselves as “IFRS knowledgeable,” familiarity with the standards seems to be improving within the accounting function. For instance, one-third of the executives say they understand IFRS well, compared with 20% of executives who said so in a similar survey a year ago. Still, a third of the executives say the lack of knowledge about international standards elsewhere in their company would be their biggest concern if they were required to adopt IFRS immediately.

Most executives cite two major hurdles to full IFRS implementation: availability of in-house resources (74%) and existing systems (68%). Yet, despite the lack of in-house resources, 81% say they expect they will build knowledge of IFRS through a reallocation of existing employee time.

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