Wednesday, September 3, 2008

Accounting standards and IT demand

Last week the SEC put forward proposals that would see the US move to the International Financial Report Standards (IFRS), as already implemented in the majority of other countries globally. This is likely to have a large impact on the IT industry generating mid-market accounting systems change projects in the US market, through the proposed implementation period of 2010 to 2014. In addition, the change is likely to result in an increased flow of overseas firms listing in the US, as the accounting burdens of dual listing are lessened.

Enterprises in the US market should reassess their ERP strategy in the light of IFRS

Mid-market enterprises in the US need to review their ERP system choices, rather than automatically addressing IFRS requirements through their existing systems. This should include radical options such as reviewing switching to a software as a service (SaaS) solution or deciding to outsource all or part of their F&A function, not just the safe option of selecting a new ERP software application from the usual list of suspects. IFRS alone should be a sufficient stimulus for this review and generate an upturn in the domestic US mid-market ERP software and services market.

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