The IFRS convergence drumbeat is evolving from a vague thump to a rumble, if still very far off. The concept has surfaced consistently in organizational webinars, conferences, SEC roundtables and your auditors planning advice. But there is not granularity around what it means or an actionable timetable.

I will leave the technical gymnastics of how the current operating structure of US GAAP would be assimilated into a global IFRS operating format for a later blog. That phase has all the collateral issues tethered to it that include (i) retraining of staff that apply it at the operating level, as well as the oversight level, (ii) university curriculum adjustments, (iii) corporate reporting systems alignment and the largest obstacle, (iv) convergence of the rulemaking entities and their processes.

It is essential to understand how both US GAAP and IFRS have been applied and enforced, both within the US and globally, at the corporate and regulatory levels, to understand the keyhole that must first be gotten through, before any convergence is realized. The sovereign interests of the authors of any IFRS convergence agreement will dictate it’s design and implementation timeline.

International firms and their auditors have coordinated reporting policy and strategy for their operations in the US and abroad, under multiple reporting structures, for decades now. The relatively recent overtures by the SEC to waive US GAAP recs and allow IFRS reporting for foreign private issuers acknowledged this. Without regard to whether the client was a domestic or foreign issuer or whether US GAAP, IAS, IFRS or local GAAP was the standard, the relevant jurisdiction determined the reporting.

To understand how global sovereign interests conduct their business and defend their jurisdictional interests, turn your attention to the long running plight of the Euro.