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18 Apr 2011
HOUSING ASSOCIATIONS have claimed switching to international financial reporting standards could wipe millions off balance sheets and jeopardise lending agreements.
As much as £1bn could be knocked off the value of estates, while the cost of switching to the new system may be as high as £150m, according to the National Housing Federation.
Further reading
The Financial Times reports 1,200 housing associations could be affected, and the largest - those managing around 30,000 homes - may have to dredge up £530,000 to cover the cost of IFRS adoption.
The 'loss' of £1bn in asset value stems from IFRS requirements to purge balance sheets of the cost of developing new properties, while simultaneously writing off similar sums from proprietors' reserves.
Housing associations are worried the switch will prompt lenders to change their terms and conditions, which could force landlords to break existing banking covenants and make it even harder to secure future funding.
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Briefings
By looking at the reasons supplier statements became unfashionable, and the reasons why it is different today, this paper delves into the many benefits that can be obtained by automating the process.
Having a real and true view of your organisation’s current financial position, and having the right systems and processes in place, will ensure that you can make strong choices and are ready to capitalise on opportunities
AccountancyAgeInsight is a frequently updated resource centre for finance professionals, offering a free and easy-to-use digital library of briefings, white papers and other information resources. 
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