Proceedings

other sophisticated systems are used) and labour (more bookkeepers are needed for
recording each transaction virtually twice) costs are counterbalanced by two dataset of
information. Moreover, the conclusiveness and consistency of accounting records is a
valuable asset of this method.
3.3. Readiness of Czech non-listed companies for the switch to IFRS
It is obvious that impossibility to apply the IFRS voluntary produces high social costs
regardless, which method of conversion is chosen by entities. Scarce economic
resources have to be employed in non-productive use. Academics and accounting
profession tried therefore persistently to persuade the Ministry of Finance to amend
the Act on accounting by enabling voluntary application of the IFRS in individual
financial statements by Category II companies. The Ministry of Finance finally
recognised this proposal to be justified. Starting from 2011, Czech companies, which
are consolidated companies in the context of Regulation 1606/2002, can chose to
prepare their individual financial statement in accordance with the IFRS. In case of
optional application of the IFRS, financial statements conversion is not an issue
anymore. However, companies may decide to maintain current status quo and to
prepare their individual statements further under CAS principles.
New provisions of the Act were enacted in December 2010. How many entities will
utilise amendments of the Act is still uncertain. As the implementation of new
accounting software is a quite complicated project, it is highly improbable that any
companies have switched to the IFRS already from January 2011. First empirical
evidence will not be available sooner than next year. Author of the paper carried out a
quick empirical pre-research to evaluate the readiness of companies, external
accounting firms, auditors and accounting software developing firms for the IFRS
transition. A questionnaire containing two sets of questions was answered by ten
accounting or auditing firms. The first group of questions relates to the possible extent
of differences between the IFRS and CAS among various types of companies,
namely:
• How significant are differences between the IFRS and CAS among
manufacturing companies?
• How significant are differences between the IFRS and CAS among merchants?
• How significant are differences between the IFRS and CAS among companies
providing services (without financial sector)?
Table 1. Differences between IFRS and CAS financial statements
Insignificant
Rather
insignificant
Rather significant Significant
Manufacturers 0% 0% 60% 40%
Merchants 80% 20% 0% 0%
Services 0% 50% 40% 10%
The second group of questions focuses on evaluation of readiness for the IFRS
adoption by various subjects, namely:
• How do you evaluate readiness of companies for voluntary application of the
IFRS?
• How do you evaluate readiness of external accounting firms for voluntary
application of the IFRS?
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