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(Revised from original 2009 version)
Choosing a GAAP for Canada
Explores Canadian regulators' decision to adopt International Financial Reporting Standards (IFRS). The Canadian decision in 2005 to adopt IFRS is particularly interesting because Canada had well-developed domestic accounting standards and because a significant fraction of Canadian industry was lobbying for the adoption of U.S. Generally Accepted Accounting Principles (GAAP) and not IFRS. The case positions the student as an advisor to an important local politician. Based on cultural, economic, and political information available in 2005, the case requires the student to choose between (1) retaining Canadian GAAP, (2) adopting U.S. GAAP, or (3) adopting IFRS.
Keywords: Financial Reporting;
Cost vs Benefits;
Governing Rules, Regulations, and Reforms;
Ramanna, Karthik, and Beiting Cheng. "Choosing a GAAP for Canada." Harvard Business School Case 110-023, July 2010. (Revised from original August 2009 version.)