MADISON, Wis. (10/13/09)--Financial regulators and corporations worldwide are moving closer to accepting--even demanding--a uniform set of international accounting standards with which financial institutions in all countries must comply. However, not all countries, including the U.S., have yet required their institutions to rise to the global regulatory challenge, said the World Council of Credit Unions (WOCCU). That inconsistency was revealed during an International Financial Reporting Standards (IFRS) webinar hosted Oct. 8 by WOCCU. The 90-minute broadcast from WOCCU's Madison office included financial experts in the U.S., Canada and Macedonia. The latter two were connected remotely. Participants from 12 countries logged on for the discussion. Demand for the topic emerged from WOCCU member countries, many of which are already in the process of transitioning to international standards, said Dave Grace, WOCCU vice president of association services. The complex demands of the process prompted WOCCU to address the topic in the webinar. “More than 100 countries are actively moving towards international standards,” Grace said. “We have a tremendous opportunity to learn from credit union systems already at the forefront of the transition. We don't want other credit unions and their regulators to have to make this journey on their own.” Participants heard from Holly Skaife, an associate professor of accounting at the University of Wisconsin-Madison, who serves on the Standards Advisory Council of the International Accounting Standards Board; Gary Rogers, vice president of financial policy for Credit Union Central of Canada (CUCC), a WOCCU member organization; and Eleonora Zgonjanin, CEO of FULM Savings House, WOCCU's member in Macedonia. Institutions in each country have found themselves at different stages of the process, and all presenters shared their experiences. “The U.S. is the largest country that has not yet embraced IFRS and still favors generally accepted accounting principles (GAAP),” said Skaife. For many U.S. regulators, GAAP’s rules-based methodology is more stringent and demanding than IFRS standards, which are more principles-based and rely on faithfulness of the representation of financial data. The country's eventual migration to IFRS, while likely inevitable, still may be three to four years away, she explained. In Canada, the process already is underway for most credit unions, which will be required to comply with IFRS standards in reporting their financial data for all fiscal years beginning Jan. 1, 2011, according to CUCC’s Rogers. This will require more judgment and more disclosure by institutions, which will be facing less rules-based guidance, he added. “This is far more than an accounting exercise,” Rogers said. “Canadian credit unions are facing a creeping crisis of complexity, and our obligation is to provide credit unions with the right tools so that, together with their auditors, they are able to ready themselves for the change.” For Macedonia’s single credit union, the process is already complete, said Zgonjanin. The credit union CEO emphasized the need for adequate time and resources. She suggested setting aside a minimum of 12 months for the transition process, including six months for development of the proper policies and procedures in order to keep the process on track. “The transition to international accounting standards is not possible to complete manually, with fewer than three employees, in less than six months and without external assistance,” Zgonjanin said. To view the webinar, use the link.