Attending the EFFAS conference, the most impressive subject was the global convergence to the IFRS, or International Financial Reporting Standard.
It was shocking to see the world map with the countries started/starting to report in this criteria colored, leaving out Japan, US and few other countries.
One of the major changes will be the "comprehensive income" instead of net income, adding minority interest, forex adjustment, pension liability, shareholding profits/losses and derivatives profits/losses to the net income. The new approach will be based on B/S items.
According to some reports, if the forex and stock market stays at the current level, some of the large caps such as Toyota, Panasonic and Mitsui could lose it's "income" by Y400-900bn, mainly due to forex matter, while Toyoda Industry could also suffer from shareholding, as an owner of Toyota Motors.
The convergence will take place by June 2011, arbitrary from 2010, and could be mandatory from 2015-2016 for the Japanese companies.
I would like to follow this topic from now on.