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on how to define a lease term and how to account for
contingent rent.”
Survey respondents were also concerned about the proposed
revenue recognition and financial instrument standards. More
than half the respondents expect the proposed standard
on revenue recognition to affect the timing or amount of
reported revenue for their companies. Of those who have
performed an analysis of the likely impact of the financial
instrument proposals, the respondents expect an increase
in the use of fair value and an increase in income statement
volatility.
While FASB and the IASB continue to try to iron out their
differences over the three major sets of standards, along
with a host of other standards that have been put on the
back burner, uncertainty continues over whether and when
the Securities and Exchange Commission will officially
approve the adoption or incorporation of International
Financial Reporting Standards later this year. The SEC
was originally expected to make a decision by the end of
June, but SEC officials have made it known lately that they
haven’t committed to that date for their decision. With IASB
Chairman Sir David Tweedie set to retire at the end of June
and incoming chair Hans Hoogervorst scheduled to take
over, there could be added uncertainty in the convergence
roadmap later this year.
Still, about 80 percent of the respondents to the PwC survey
believe IFRS is coming at some point, according to Schmid.
About 80 percent of the respondents to the PwC
s
Updates on the work plan for achieving convergence
have not been coming with the regularity that had been
promised either. SEC officials have recently floated the idea
of something called “condorsement,” which would be
somewhere between convergence and endorsement. This
would be the approach of some other countries that also
have not wholeheartedly embraced IFRS.
SEC Deputy Chief Accountant Paul Beswick spoke about
“condorsement” during a speech at an AICPA conference
last December. Under this approach, U.S. GAAP would
continue to exist, and the IASB and FASB would finish
the major projects remaining in their memorandum of
understanding. FASB would not begin to work on any major
new projects on its own, but as new standards were issued
