Accounting changes provoke strong interest – PwC
IMMINENT changes to accounting practices, which will require most private companies to change the basis upon which they prepare their accounts, are attracting a high level of interest as the deadline for compliance nears, according to PricewaterhouseCoopers in the Midlands.
Guidance on the new accounting standard, known as IFRS for SMEs, has already been published and the period for consultation closed at the end of February.
All but the smallest private businesses, including subsidiaries of listed companies, will need to adopt the new standard in the near future.
The first businesses to be affected by the rule changes will be those with a financial year ending in December 2012 and for the purposes of comparative reporting, the standard should be adopted in 2011.
To help private companies in the Midlands to prepare for the introduction of the new accounting standard, PwC is hosting an event at its Cornwall Court offices in Birmingham on Thursday (April 29).
Andy Hammond, partner and assurance expert at PwC, said: “There has been a noticeable surge in interest in the new accounting standard over the past few weeks in the Midlands.
“The changes will affect the majority of unlisted companies in the Midlands and given the choices available to them they need to be considering their options now.”
“Understandably, they want to make sure they are ready to meet the new requirements in good time,” he added.
According to PwC, the recent upturn in interest in initial public offerings (IPOs) is helping to restore confidence and encouraging some companies in the region to take a broader look at their financial reporting in the light of the new standard.
“For some private companies in the Midlands, who may be considering raising money in the market in the next year or two, now could be the right time to consider adopting the full International Financial Reporting Standards (IFRS) instead of IFRS for SMEs,” said Mr Hammond.
“Doing so, would enable them to build their financial track record ahead of their listing, boosting their investor appeal, and could provide a useful stepping stone to the financial markets.”
