The adoption of the IFRS ( International Financial Reporting Standards) is widespread; almost one hundred nations have adopted it, including the European Union, Hong Kong, Australia, Malaysia, Pakistan, India, Russia, South Africa, Singapore and Turkey, with over 12,000 companies doing so.
The switch to IFRS would allow some large multinational companies to drop GAAP beginning in 2010, with all companies in the U.S. switching starting in 2014.
Explanation by the SEC
The SEC said that the change is necessary in that it will help the U.S. to compete globally inasmuch as over 100 countries around the world use IFRS, and two-thirds of U.S. investors own stock in foreign companies.
