Accounts departments still in the dark about IFRS
Public sector bodies will be required to adopt International Financial Reporting Standards (IFRS) for their 2009/10 accounts and will also be required to restate 2008/09 accounts using IFRS to provide comparative information. However, despite these imminent changes, there appears to be a general lack of awareness among many public sector organisations.
Increased demand for accountants with this specialist knowledge
From our research it appears that only the larger central government departments and NHS trusts are acknowledging the change and etablishing either specialist in house teams to update their accounts in line with the new standards or recruiting external additional temporary resource.
IFRS is likely to be a challenge for many public sector organisations, not only from a technical accounting issue but also the impact of changes on other areas of the organisation such as the setting and measurement of performance targets, budgeting and forecasting - as well as financial reporting. It is therefore imperative that timely communication of the issues, both internally to employees and externally to stakeholders is effective.
Not for profit organisations and housing associations who are in the know, have been advised by their auditing bodies to hold off on any changes for the next financial year, however many are completely unaware of the new standards altogether. This is not surprising considering many of these organisations operate solely under SORP and therefore will not be adopting IFRS. International charities currently operating under UK GAAP will be impacted however, as they will need their accounts to be IFRS compliant for international consistency.
What is apparent however, is that when public sector organisations fully address the IFRS issue, there will certainly be an increased demand for accountants with this specialist knowledge. There is talent out there and we have worked with many of the leading specialists in the IFRS field in the private sector, who can bring this knowledge and expertise to the public sector to ensure that deadlines for the new standards are met.
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