Tuesday, June 17, 2008

IFRS Conversions: Statistics and Surveys - a devil?

An interesting point came up at the FASB Forum yesterday. Has anyone considered the effect of the conversion to IFRS on government statistics and on the various surveys completed by companies?

I must confess this point had escaped me until one of the speakers raised the issue. Governments collect a mountain of data from companies. How will their reporting be affected by IFRS conversion. On first blush there seems to be a danger and indeed high probability of data inconsistency say from 2010 to 2011 in Canada's case. "Heads up" to Statistics Canada - I hope that you have started to think about this!

As a former CFO I am familiar with the various surveys from magazines, newspapers, associations, government etc. The surveys could be prepared for the top companies in Canada or some such thing. They can be tricky and need to be controlled by respondents. Often there might be different definitions for the "same" thing. For example "assets" can mean different things from one survey to another e.g. what is included as assets. Be careful here. One of the most important things in these surveys is consistency from year to year - forget that on IFRS conversion. Do the authors of the surveys know that IFRS conversion will happen? What are their plans?

Perhaps this "Statistics and Surveys" issue can be helped and even resolved by the adoption of automated reporting such as XBRL? I don't know. It seems to me that if data is collected at a certain level of granularity a "Taxonomy" can be developed to cover these situations and remove the possibility of error - over to the IT gurus - am I just talking through my hat? I would like to hear from you.

Consider the following quote and quote within a quote and reflect on it. Both Mark Twain and Disraeli are a great source of inspiration to me.

Figures often beguile me, particularly when I have the (task of) arranging of them myself; in which case the remark attributed to Disraeli would often apply with justice and force: "There are three kinds of lies: lies, damned lies and statistics."

From Mark Twain

1 comment:

The IFRS Exorcist © said...

I have sent a copy of this to Statistics Canada for comment.