Factors to Consider When Converting from US GAAP to IFRS

June 10, 2025

1. Strategic Objectives and Business Rationale to Understand

What is Purpose of Conversion

Stakeholder Needs

2. Differences Between US GAAP and IFRS

Conceptual Approach

US GAAP is more rules-based, while IFRS is principles-based, offering broader guidelines that require more professional judgment.

Key Technical Differences

Revenue Recognition (ASC 606 vs IFRS 15)
Leases (ASC 842 vs IFRS 16)
Financial Instruments
Inventory (LIFO not allowed under IFRS)
Development Costs (Capitalized under IFRS)
Impairment Testing
Income Taxes
Provisions and Contingencies

3. Project Planning and Governance

Project Management Office (PMO)

Establish a dedicated team to oversee the conversion process.
Diagnostic and gap analysis
Design and planning
Implementation
Dual reporting period
Go-live

4. Financial Reporting and Restatement

IFRS 1 – First-time Adoption

Chart of Accounts and Reporting Format

Disclosure Requirements

5. IT Systems and Data Requirements

6. Tax Implications

7. Internal Controls and Audit Readiness

8. Human Capital and Training

9. Impact on Business Processes and KPIs

10. Stakeholder Communication

11. Cost Considerations

Category	Key Considerations
Strategic Objectives	Purpose, stakeholder needs
Accounting Differences	Technical gaps, principle vs rule-based
Planning & Governance	PMO, timeline, milestones
Financial Reporting	IFRS 1, disclosures, restatements
IT Systems	ERP changes, dual reporting
Tax Implications	Deferred tax, ETR impact
Internal Controls	SOX, control design
Human Capital	Training, change management
Business Operations	KPIs, contracts, metrics
Stakeholder Communication	Investors, regulators
Cost & ROI	One-time and ongoing costs

How Online Accountant Can Support Your US GAAP/IFRS Transition

At Online Accountant, we understand that transitioning between US GAAP and IFRS is a complex, high-impact initiative that goes beyond financial reporting. Our multidisciplinary team brings deep expertise in both accounting frameworks, combined with practical industry knowledge, to ensure a seamless and efficient conversion tailored to your organization’s unique structure and goals.

We begin with a detailed diagnostic assessment to identify key differences between your current accounting practices and the target framework. Our specialists work collaboratively with your finance and executive teams to develop a customized roadmap, addressing policy gaps, systems integration, internal controls, tax implications, and stakeholder communication. Whether transitioning to IFRS for global reporting purposes or converting to US GAAP for SEC compliance, we provide strategic guidance every step of the way.

Online Accountant also offers hands-on support during the implementation phase, including restatement of prior period financials, development of IFRS- or US GAAP-compliant accounting manuals, training workshops for staff, and coordination with external auditors and regulators. Our goal is not only technical compliance but also operational continuity and clarity, enabling your leadership to focus on value creation and informed decision-making throughout the transition process.