Little planning for tax change

A SURVEY by accounting body CPA Australia has found that few Australian firms are preparing for the roll out of new international financial reporting standards (IFRS) from January 1 2005.

The survey revealed that 69 per cent of CPA members were aware that international standards would replace existing Australian accounting standards.

Further, 62 per cent of members were aware the new standards would apply to all reporting entities, including not-for-profit and public sector entities.

But only 11 per cent of respondents indicated their business has a strategy in place to manage the transition.

Only 33 per cent were aware of the need to start calculating comparative data for their financial reports from January next year.

CPA Australia CEO Greg Larsen said the move to international standards was a massive challenge and planning would help business avoid ‘surprises’ down the track.

“Until the new standards are confirmed it is difficult for business to determine the full implications, but some of the proposed IFRS have the potential to fundamentally change how financials statements are prepared and that may mean big changes to reported results,” Mr Larsen said.