The Great Accounting Transition – Is UK Adaptive Enough?

With the recession officially over and the UK economy slowly trudging back on its own feet, it is but natural that the accounting procedures were also supposed to change.

Although the austerity drive by the UK government has made life a bit tougher for the general public in the country, the London accountants have made a pretty decent job of playing catch-up in this financial game of cat and mouse.

The transition from the generic UK-based accounting system of GAAP to the more global-faceted IFRS (International Financial Reporting standards) has been smooth to an extent, as put by the Director of Ernst & Young LLP, Mr. Matthew Williams.

According to Williams, even though most of the chartered accountants in UK have grown up and worked in the GAAP system, most have not been uncomfortable in shifting to the new framework of financial reporting.

Experts have noted that the similarities between the two systems have helped the accountants, fresh or veteran, to cope up with the change. This is not the case in the US, where accounting standards are yet to be harmonized with that of the international statute.

However, one of the major criticisms of the IFRS has been the complex taxation & real estate regulations – which often become a serious obstacle in fast accounting procedures.

What do you think? Do you think the IFRS is the right way to go for the London accountants? Or was the old system the more stable one to follow? Feel free to comment!