Accra, GNA - Come January 1, 2007, all public utilities, banks, insurance companies and listed companies on the Ghana Stock Exchange would be made to comply with the International Financial Reporting Standards (IFRS).
The adoption would mark the formal transition from the use of the Ghana Accounting Standards (GAS) to the IFRS, which are now virtually accepted as common yardstick for international reporting.
Small and Medium Scale Enterprises (SMEs), Ministries, Departments and Agencies (MDAs), state-owned organisations and private organizations have been given a two-year transition period which end in 2009.
The GAS, which was set up in 1993 by the ICAG, would therefore be phased out entirely at the end of 2009.
Presenting a paper on the IFRS to sensitize local companies on Thursday, Mr Bright Obeng-Boampong, Chairman, Technical and Research Committee of the Institute of Chartered Accountant, Ghana (ICAG), said the new standards would enable Ghanaian companies\' financial statements to be understood in the global market place.
He said it would ensure greater comparability of financial information of companies in Ghana with their peers in other parts of the world as well as ensure investor confidence in the financial reporting.
Explaining Ghana\'s process to adopt the IFRS, Mr Obeng-Boampong said in 2005 an 11-member task force drawn largely from accounting firms was set up to propose country strategy on the standards.
He said the task force recommended among others a wholesale adoption of the IFRS by companies and the establishment of Financial Reporting Council (FRC) to comprise the Ghana Standards Board and an Investigative Panel.
Mr Obeng-Boampong said the IFRS included seven new standards, nine interpretations, 13 revisions of the International Accounting Standards (IAS) and 18 amended IAS.
He said currently ICAG\'s support facilities would include continuous education for members from January next year, education of teachers, analysts and journalists on the effect of the migration from GAS to IFRS.
A Help Desk would be created at the Secretariat of the ICAG to offer advice on implementation difficulties.
Touching on the challenges of the migration, he said firms should not underestimate IFRS conversion since they were more complex and required more disclosure than the IASs especially regarding business combinations, deemed cost of property, plants and equipment.
Mr Obeng-Boampong said the key challenges would be the availability of the standards to members and the harmonization of the country\'s laws with the IFRS.
\"It would also require a thorough review of companies laws and accounting policies.\"
Professor Nana Ato Ghartey, President of the ICAG, gave an overview of the IAS tracing its evolution from 1966 and roles played by member countries and indicted Africa that had not exerted itself in the affairs of IAS.
He said being a member of the International Financial Accounting Committee (IFAC), Ghana had no choice but to wake up and join the bandwagon.
Prof. Ghartey said the GAS had become obsolete in relation to the fast pace at which the IAS was being reviewed to accommodate investor requirement.