IFRS effects on standards, litigation, curriculum, and employee training

The following article from Knowledge @ P.W. Carey covers some interesting developments in the transition that the US is making to the International Financial Reporting Standards (IFRS). While the transition is designed to be a force for good - transition to common standards that provide some leeway in prescriptions that are specific to a company's internal structure and external realities - I have noticed a couple of negatives; at least from the above article. The first is the potential increase in the number of lawsuits that are brought against auditors - a fact mentioned in the article.

However, there is a second aspect that troubles me. As the article states, "'What you will see is more footnote disclosures in financial statements.' That means investors will work harder to understand the financial health of companies they're researching." A more thorough and honest picture of a company is something that most stakeholders would applaud. However, how such honest information is presented makes a big difference. Copious footnotes might be a recipe for problematic outcomes on the investor side. Financial researchers are under tremendous pressure: they are supposed to invest in jewels and find such firms under short deadlines. I am afraid that "more footnotes" will result in increased complexity of the information reviewed by researchers. This could lead to a less thorough analysis. I believe that auditors will have to devise a better way to present vital information. Also, as the article states, in the future, auditors will have to communicate in even clearer terms than they do today. I hope that the accounting profession will successfully step up to the new challenges.