Experts have warned that software houses are failing to push ahead with the development of programmes capable of handling international accounting standards due for implementation in just four years.
The switch to international accounting standards for listed companies in Europe, set for 2005 by the European Union, will affect those software packages that currently use UK accounting rules in their calculations.
‘Software houses should be at the stage of thinking about it and beginning to develop products compatible with IASs,’ said Peter Holgate, senior accounting technical partner at PricewaterhouseCoopers, explaining that software houses should start preparing now.
Holgate also pointed out that if the Companies Act, currently under review, permits the use of IAs from 2003, ‘companies would have to have everything in place very soon’.
Dennis Keeling, BASDA chief executive, dismissed concerns: ‘Packages are flexible enough to meet most countries’ requirements. It doesn’t affect us. It’ll affect the accountants who will have to interpret the figures,’ said Keeling.
Derek Lemay, director of audit at HLB Kidsons, said: ‘It should be a simple process, but with software nothing is simple. I wouldn’t imagine it would cause them any great difficulty. The only thing is they might not see it as a great priority.’
Lindsay Gasser, international product manager at giant software provider Systems Union, is however already gearing up.
‘We’re at the thinking stage. It is on our agenda. There are various implications we have not as yet understood. It’s going to be complex,’ she said.
However, Gasser voiced concerns over the ‘much clearer divide’ between accounting for tax purposes and financial reports. ‘The two will be in conflict,’ she said.
Systems Union plans to launch its research and find out what is needed over the next three years.
The European Council of Ministers and European Parliament are expected to ratify the EU’s endorsement on IASs for use in Europe by 2005 in the next few months.
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