An IFRS transition is not a switch on a reporting date but a project over nine to eighteen months. We provide the project lead that carries it – for a fixed term, alongside day-to-day operations.
An investor needs IFRS numbers for its own reporting, a loan agreement defines its ratios on IFRS, an international buyer is on the horizon, or a parent company reports on a uniform group basis. The change is therefore a given – the only question is who leads it.
The company usually lacks both: experience with first-time adoption, and capacity alongside the day job.
The interim CFO leads the project and takes the decisions that move it forward: analysis of the differences against the company's own facts, selection of the IFRS 1 exemptions, construction of the opening balance sheet, adaptation of chart of accounts and systems, parallel accounting, then conversion of ongoing reporting.
The real bottleneck is not the accounting but the data gathering. IFRS 15 requires contract information that sits in no bookkeeping system; IFRS 16 requires a complete register of all rental and lease agreements including extension options. That stocktake belongs at the start.
And a point that often comes too late: IFRS 16 changes total assets, EBITDA and leverage – and with them the ratios in existing loan agreements. That effect should be discussed with lenders before the transition.
Contract information for IFRS 15, complete register of all rental and lease agreements including extension options for IFRS 16. This work belongs at the start, not the end.
Analysis of the differences against the company's own facts, decision on the IFRS 1 exemptions, construction of the opening balance sheet.
Adaptation of chart of accounts and systems, then parallel accounting over at least one financial year.
Ongoing reporting under IFRS, extended notes, handover to the internal team.
For a mid-sized company without prior experience, nine to eighteen months from project start to the first audited IFRS financial statements.
IFRS 1 requires an opening balance sheet at the start of the earliest comparative period presented. All items are to be accounted for as if IFRS had always applied – with a limited number of exemptions.
Depending on the business model, IFRS 15 on revenue recognition or IFRS 16 on leases. The latter visibly changes total assets, EBITDA and leverage.
Their ratios can change through the transition alone. That should be discussed with lenders beforehand, not explained afterwards.
Usually not. Two to four days a week over the project duration is typical – after which the need ends again.
The service: External CFO. For a fixed-term project see Interim CFO, day rates by role on the pricing page.
Term in the glossary: IFRS transition.
Related situation: ERP and system change in finance. In depth in the article Converting from HGB to IFRS.