Research from a survey of over 300 UK CFOs, FDs and senior finance professionals including major corporations such as BT, BBC, VISA and AstraZeneca has found that telecoms, property and technology companies are most at risk of non-compliance with the stringent new IFRS 15 accounting standard.
By 1 January 2017 all UK companies will need to comply with the new global framework for revenue recognition accounting which will replace all existing IFRS and US GAAP guidelines. Businesses have no choice but to create new processes that can supplement existing systems to cope with the complexity and additional data volumes that the new accounting rules will bring.
Despite the changes coming into effect in less than 20 months, the survey which was conducted by GAAPweb, the UK's #1 job site for finance and accountancy professionals, in association with Cedar, the senior finance recruitment business, found that over a third (36%) of respondents were unaware of any change to the way revenue will be recognised.
Of those respondents that were aware, 73% did not envisage the change having a significant impact on their business. These findings contradict recent guidance from the IASB and FASB about the impact the new standard could have especially in the telecommunications, technology and property sectors due to their complex goods bundles.
Over half of those surveyed (52%) had made no preparations for the change, whilst only a third (35%) had only just started to review the new requirements.
86% of those surveyed expected existing finance teams to absorb the additional workload caused by the new standard. Although, at this early stage, 24% of respondents expressed a need to recruit and stated that experts in transformation, IFRS & GAAP would be most in demand. To download the full report, click here.
Howard Bentwood, managing partner at Cedar, said: "The results of this report further highlight the need for companies to better understand the enormity of the impact that IFRS 15 will have on their finance functions. As a business we have noticed a spike in demand for skilled senior finance professionals with experience in system development and implementation. Many of Cedar's clients in the telco/telecoms and property sectors are acutely aware of the impact that IFRS 15 will have on their business and have already started to recruit to bolster their teams. Cedar is currently partnering with theseorganisationsto assist with their IFRS 15 recruitment strategies."
Sarah EL-Doori, Marketing Director at GAAPweb added: "The seniority of GAAPweb's audience allows us to conduct industry research providing insight into the key issues affecting senior finance professionals across all sectors."