Investors require financial data that is comparable over time, comparable within a single set of financial statements, and comparable between companies. Unfortunately, this is not always the case. We explain how differences between IFRS and US GAAP, accounting policy options, differing interpretations and accounting estimates, can all reduce comparability.
Convergence and comparability should be a priority for the IASB and FASB. Present consultations by the IASB and FASB regarding the accounting for credit losses are a good opportunity to better align IFRS and US GAAP, and to remove the confusing disconnect between purchased and originated loans, as we discuss in our response.Continue reading “Comparability is crucial for informed investment decisions”