Summary
Accounting standards are meant to be followed and reviewed. It looks like adequate review of US GAAP did not take place in the last 20 years. In the meanwhile, the IASB was very active on this front and used the feedback from industry to revise the standards. And this process is still going on! No wonder, then that IFRS has been termed as a moving target. And this is the genesis - the FASB was concentrating on framing new standards; the IASB was concentrating on reframing previous standards to give more scope for flexibility and transparency in accounts.
Analysis
For all those used to working with US GAAP, IFRS opens up a new opportunity to reflect on the shortcomings of what is being currently done. Often, one gets so used to doing things in a particular manner that one stops thinking whether the goal of accounting can be achieved better by following a different way of thinking. Why are we doing the way we are doing? Could there be a better way of reporting the same transaction - this is what seems to be in-built into IFRS. The costs of moving over to IFRS seem to be high because thinking on the appropriateness of standards used has not happened gradually; it seems to be an abrupt switch over to IFRS because others are doing it. The biggest lesson for all whether they switch over to IFRS or not is that continuous review of procedures is an absolute necessity. This is what is taught in all quality programmes as well. No one can achieve Six sigma without continuous review of procedures followed.
