International Financial Reporting Standards (IFRS) govern the reporting of accounting transactions and events in financial statements. IFRS has become a global financial reporting language in the last 15 years. We now have 130+ countries that prepare IFRS financial statements for their large companies.

5 Key Reasons Why Finance Professionals need to be Updated on IFRS:

1. Emerging topics: We live in an imperfect and uncertain world. Transactions and associated risks are often complex to understand, let alone recognize them. It is often difficult to evaluate the exact nature and timing of transactions in the digital economy. New topics like Islamic banking, carbon accounting and cryptocurrencies have emerged. These emerging areas in international finance need to be recognized, reported and analysed in a consistent manner for efficient global markets.

2. Time is money: A global financial language removes the need for an interpreter. A consistent approach to understanding and analyzing financial markets reduces cost of capital and time taken to evaluate information. This would expedite the decision-making process.

3. Cross border transactions: The high number of acquisitions, joint ventures and transactions between international counterparties makes the need for a common reporting language a must. It makes due diligence process easier and reduces costs of such transactions.

4. Technology and global mobility: Technology has reduced human effort required in performing various tasks. Complex calculations and reporting can be done at the click of a mouse. It is however imperative that prepares of financial statements and practitioners are able to explain these calculations to ensure correct and consistent valuations. The knowledge and experience of a common financial reporting language also provides global mobility to IFRS experts.

5. Moving goal post: The only thing constant about the global markets is change. The last two years has seen new standards on revenue recognition, financial instruments and leasing become effective. These amendments have a major impact on results of financial analysis and related decisions. Finance professionals need to understand, evaluate and communicate the impact of such moving goal post to senior management and investors