More than 90% of Australian financial institutions taking part in a survey say they approve of the adoption of International Financial Reporting Standards (IFRS).  Terrific – but only 38% of the organisations affected actually know what it’s all about.

Australian Banking and Capital Markets Leader Michael Codling says the 38% in the PricewaterhouseCoopers Economist Intelligence Unit survey believe their institution has a good understanding of the proposals.

“This is a concern given the highly compressed timetable for implementation leaves little time for reflection, much less for action,” Mr Codling said.

The survey showed that two-thirds of respondents think IFRS-compliant institutions will be more transparent in their reporting. But views on the importance of IFRS varied.

Just 22% of respondents thought IFRS adoption is a key business priority – even though the standards will be adopted from the financial year beginning 2005.

Mr Codling warned that all financial institutions need to act now to assess the impact of IFRS on their business and to start making preparations to adapt. He said these changes are the biggest in financial reporting for more than 30 years.

“Given the lack of clarity on what the final standards will look like, it is not surprising that the survey revealed a high degree of uncertainty among financial institutions,” he said. “With the 2005 deadline looming, many financial institutions have a lot to do in a short space of time.”