Case Study - Finance & Accounting

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North American Integrated Energy Provider Confronts Transition to IFRS

Challenge
The client, a Canadian public company, has a fairly complex organizational structure including multiple subsidiaries, joint ventures and minority interest relationships. Additionally, the client was growing via acquisition of small energy recyclers. We were working with the client's U.S. subsidiary to establish accounting policy and U.S. Generally Accepted Accounting Principles (GAAP) presentation for fiscal years 2005 - 2007. In April 2008, the Canadian Accounting Standards Board adopted International Financial Reporting Standards (IFRS) in Canada, confirming the mandatory transition date to IFRS for publicly accountable enterprises effective fiscal years beginning on or after January 1, 2011. The Canadian adoption of IFRS created a need to transition from both U.S. and Canadian GAAP.

How We Helped
We are implementing a three-phase transition methodology to complete a smooth and timely adoption. Phase I, the diagnostic stage, was recently completed and encompassed project planning and a preliminary impact study. In this phase, we developed a four-year timeline of the transition process-identifying the major milestones and deliverables required throughout the process-as well as a preliminary project plan transition overlay. Additionally, we performed a diagnostic analysis of the high-level issues that will develop from the transition and prepared mock financial statements (using the company's 2007 annual report) adjusted to reflect IFRS standards.

Phase II will consist of the detailed steps necessary to prepare the first complete IFRS financial statements. In Phase III, the issues and solutions will be gathered and integrated into the company's underlying financial systems and processes.

Results
With our help, the U.S. subsidiary is ahead of schedule in implementing IFRS.

Why Resources Global?
Through a previous relationship with the client we had proven our versatility and competence. We brought them extensive public accounting experience with the Big Four, as well as industry experience with SEC and GAAP reporting.