Korea, the host of the 2010 G20 Summit, requested the G20 to delay the consolidation process of the global accounting standards. Korea has defined its role at the G20 mainly as an arbiter and a consensus builder among the world’s largest economies.
The G20 initiative for new, consolidated rule, Korea believes will be an issue for the Korean firms. Considering that many large firms have already spent a lot of money in setting up accounting and IT systems based on the IFRS method over the past few years.
Accounting firms say that the move towards convergence could cost Korean firms tens of billions of won, after they have just spent a huge amount of money in shifting from the GAAP-based standard to the IFRS-oriented one. The government is forcing them to use the IFRS for every listed company from next year.
Only time will tell whether Korea will be able to get a consensus among the G20 members to move the consolidation process to a later date and save the Korean firms from spending even more on meeting the new requirement.