In the nation’s finance departments, the wince-inducing memories are still fresh of having to lean on IT for help deciphering Sarbanes-Oxley. Yet CFOs are being faced once more with turning to their technology counterparts for guidance in a major financial reporting project.

The job this time — converting to a new accounting language — could require changes to IT systems, too.

Accounting experts are recommending that those conversations begin now, as the Securities and Exchange Commission inches toward mandating that all U.S. publicly traded companies use international financial reporting standards.

“It’s incumbent [on] the CFO to include the IT teams as well as the operational teams in the initial dialogue to ensure they all get a seat at the table early to avoid the challenges we saw with [Sarbanes-Oxley],” says Terri McClements, a partner at PricewaterhouseCoopers.

Questions for CIOs and CFOs to contemplate include: How will running both IFRS and GAAP at the same time affect their method of updating their general ledger and chart of accounts? How should metrics and budgeting and forecasting applications be changed? Will differences in IFRS require new data entries? And how can they ensure that the data produced by the newly tweaked systems is clean?

Fortunately, the largest commercial ERP systems, such as Oracle and SAP, are able to handle running two sets of generally accepted accounting principles — a likely requirement for the foreseeable future. However, companies with older versions of the software may have to upgrade or reconfigure their current system.

To be sure, CFOs have time before they need to start worrying about whether they’ll get what they need from IT in time for a conversion to IFRS. The SEC’s proposed roadmap for moving all companies onto IFRS gives most companies eight years before they would publish IFRS-prepared filings. Still, knowing the move to a new set of accounting standards is imminent could affect decisions about current ERP projects underway, advise accounting experts.

Chris Wright, a managing director at consultancy Protiviti, suggests that all companies undertake a preliminary, high-level test of their financial statements to see how they would differ under IFRS. Such a review would uncover the issues that could arise, and some that could be addressed now. “A CFO would want to get the business diagnostic done quickly to understand who and what is involved in the next steps, including IT,” Wright says.

For instance, companies that use LIFO (last in, first out) — which is not allowed under IFRS — may need to revisit their inventory accounting systems. Likewise, data feeds from logistics systems used for calculating revenue recognition may have to be tweaked to make up for the way IFRS lets companies record revenue differently than U.S. GAAP.

Other changes that companies must address relate to changes in accounting for research and development. Under IFRS, companies capitalize their development costs, whereas GAAP allows companies to expense their R&D costs as one item. Since most U.S. companies’ IT systems aren’t built to separate out that information, companies would have to make a change to get their development costs accounted for on their balance sheets, notes Todd Markus, vice president of accounting and finance and enterprise governance, Accretive Solutions, a financial consultancy.

It could take a company 18 months to prepare its IT systems for IFRS, Markus estimates.

Wright and other financial-reporting advisers believe that companies will be better off in the long run if they make changes to the technology systems that support their accounting before they begin transitioning to IFRS. The alternative — a retroactive application of IFRS after crunching their GAAP numbers — could create control breakdowns, as some European companies discovered when they changed over to the global standards a few years ago.

“Companies that took a fulsome approach didn’t have to rework their processes so they saved time at the end,” McClements says.

Those companies that took a topside approach to their accounting had a tougher time supporting their final numbers before they had to file their IFRS statements. In many cases, the European IT departments were doing last-minute checks of their controls to provide the documentation to support the final financial reports, McClements adds.