The Truth About IFRS on the CPA Exam

IFRS. IFRS. IFRS. IFRS. IFRS. IFRS. IFRS.

I could say it a million more times, but that still won’t catch up to the amount of times you’ve probably already heard this all-too-popular acronym in the accounting microsphere. We already know it’s important and we already know that eventual convergence is (probably) imminent. Let’s face it, though: while we appreciate the changes being made to standardize global accounting standards and smooth over any inadequacies in the framework, we students are freaking out.

“So, are we having FIVE exam sections now?”

“I heard it’s going to be twice as long.”

“They’re going to put IFRS stuff on the CPA exam this year! We have to start learning all about it, or we’ll fail!”

Amidst a world of confusion and misinformation, I present to you: the truth. The following sections will purportedly have general IFRS questions as of the 2011 exam:

FAR

• The differences between financial statements that are prepared using GAAP standards vs. those that are prepared using IFRS.
• How the first-time integration of IFRS standards will affect financial reporting, presentation, and disclosures.

BEC

• The effects of globalization on the business environment.
• Candidates may be asked to explain the underlying economic substance of transactions.

AUD

• The role of the International Auditing and Assurance Board (IAASB) in establishing International Standards on Auditing (ISAs).
• The differences between ISAs and U.S. Auditing Standards.
• The role of International Ethics Standards Board for Accountants (IESBA) in establishing requirements for the Code of Ethics for Professional Accountants of the International Federation of Accountants (IFAC).
• An understanding of AICPA Codification of Statements on Auditing Standards, AU Appendix B, Analysis of International Standards on Auditing.(1)

As of now, the REG section will not have any IFRS-related questions. Not *too* bad, right?

The good news is, readers, that most CPA exam courses are now chock-full of bountiful IFRS info. Probably more than you even need. Rest assured, what you may be missing in your classes will be generously supplemented by your chosen CPA review.

If you’re interested in an even more detailed look at what changes, IFRS-related or not, have arrived in the 2011 version of the exam, check out the video below:

Remember: IFRS doesn’t bite. Learn it, but don’t kill yourself trying!

(1) Source: http://blog.rogercpareview.com/2010/04/more-details-on-introduction-of.html

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