By: Evan, Kelsey, Adrian, Vivi, & Jordan
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The Big Bang Approach
 The problem at hand:
 The “Big Bang” approach vs. “Staggered Transition”
 Our Decision:
 The Big Bang approach is best method
 Companies start accounting in accordance with IFRS beginning
January 1, 2015
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IFRS: Big and Small Business
 Complete understanding by date of adoption
 Principles = 2,500 pages (IFRS) vs. 25,000 pages (USGAAP)
 Comparative statements: current and prior year only
 Potential need for additional employees to convert 2014 financials
during 2015
 International understanding
 Adoption regardless of company need
 “...a single set of high-quality global standards.” – Arleen Thomas,
AICPA
3
Big Bang: Big Business
 Pros:
 Consistent statements throughout quarters
 Less hassle for businesses already engaging in international affairs
 Less interaction with the SEC, the better
 Cons:
 For some companies, having to switch all at once might take away
from their current tasks
 No way to ensure that big businesses are going to be ready to
convert under the big bang
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Staggered Transition: Big Business
 Pros:
 Series of checkpoints to ensure progress
 Less pressure and more confidence in transition to IFRS
 Large companies can spend more time to become proficient in IFRS
 Cons:
 Inconsistent statements throughout quarters
 Increases SEC interaction
 More costly for the SEC to continually monitor conversion
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Big Bang: Small Business
 Pros:
 Transition to IFRS for small and medium enterprises (SME’s)

Modified version of IFRS – less encompassing

Less costly
 Less interaction with the SEC during transition phase
 Cons:
 Pressure and expectations with SEC
 Unnecessary switch
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Staggered Transition: Small Business
 Pros:
 Guidance throughout the process
 Less confusion
 Cons:
 Transition period will yield inconsistency for business owners
 Difficult for SME’s to meet demanding checkpoints
 “Babysitting Effect”
 Unnecessary switch
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PwC: Big Bang and Staggered
 Overall effects on PwC should not vary much between approaches
 Training is in accordance with PwC’s schedule
 Staggered transition, PwC will need to teach employees in concert
with the SEC checkpoints
 Opportunity to increase revenue through training companies
 Ernst & Young significantly aided Coca-Cola in implementing IFRS
 Cost to teach additional employees vs. future revenue increase
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Big Bang Time Line
 Implement IFRS standards beginning January 1, 2015
 Issue 10-Q statements for 2015, supplemented with quarterly figures
from 2014, all of which are in accordance with IFRS
10Q filings, also including 2004 quarterly
figures, in accordance with IFRS
Prepare for Big Bang (IFRS)
Q1-15
01/01/2014
Q3-15
Q2-15
present
01/01/2015
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01/01/2016
Other Factors Supporting Time Line
 Investor knowledge of IFRS
 Substantial time needed for investors to become fluent in IFRS
 Investors need to fully understand IFRS before it is implemented
 Initial Public Offerings
 SEC currently requires five years of audited historical financial
 Adjusted IPO deadline
 Time needed to adjust legal contracts
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Questions?
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By: Evan, Kelsey, Adrian, Vivi, & Jordan
Big Bang Approach
Effects on PwC
 More consistency among financial statements
until date of adoption (01/01/2015)
 Less interacting with the SEC
 No way to ensure that companies will be ready
for the transition on the Big Bang date
Less variability of effects from two approaches
Staggered Transition
Additional Support for Time Line
 Series of checkpoints to ensure participation
 Investor knowledge of IFRS
 Increased interaction with the SEC
 Initial Public Offerings
 Inconsistent financial statements during
transition period
 Legal documents
Prepare for Big Bang (IFRS)
Opportunity for increased revenue
10Q filings, also including 2004 quarterly
figures, in accordance with IFRS
Q1-15
01/01/2014
Q3-15
Q2-15
present
01/01/2015
01/01/2016