Trinity Industries Executive Summary

Trinity Industries
International Financial Reporting Standards (IFRS):
Change:
Changes in accounting and financial reporting are inevitable, and accounting standards are likely to change. There are several areas of accounting that are implicated due to the change in accounting standards. For instance, one implication is the system needs to be upgraded and integrate the new standards. The company and their CPAs should consider the benefits and costs, (Aldridge & Hall. 2007). A change could either save the company money or cost them more in compliance. “An audit partner at a national CPA firm ... says if a change would enable a company to better communicate the results of its business to stakeholders, the company should make the change even

In order for Trinity to improve internal control compliance, Trinity must prepare for potential risks. Companies will also need to evaluate the impact these differences may have on their accounting policies, as well as the underlying information technology systems that support the company’s financial reporting structure, (Arnold, 2009). Trinity must undergo changes to internal control in order to meet IFRS changes. ERP and consolidation systems will need to be assessed to determine if they can handle the requirements of dual ledgers and reporting, (Arnold, 2009). First, Trinity must establish an internal control team that can identify the differences between GAAP and IFRS. This could include bringing in consultants who are more familiar with IFRS and can help internal controls make new guidelines for the company. “While [Trinity] may be familiar with the general principles of IFRS, such as a potential need to depreciate components of fixed assets on a detailed level, a thorough review will make clear that there are many rules and requirements in these principles-based standards,” (Arnold,

Within the corporate governance, they follow the “Principles,” and they assist the Board in the exercise of its responsibilities. Trinity’s governance will have a role for implementing the IFRS conversion governance process through implementation of a steering committee. Trinity’s governance should begin their IFRS conversion process with setting the tone with managers and executives showing active participation in testing and monitoring controls that they establish. Governance will also have to put great importance in the reformatting and significant expansion of their accounting policies and procedures. Once Trinity’s governance establishes a corporate policy is properly vetted for IFRS compliance, it will be necessary to establish specific accounting policies, procedures, methods and consultation protocols to ensure consistency, (Hobbs & Wright, 2010). After corporate governance has agreed upon the right policies for each area needed to be covered for IFRS compliance, then their role is complete and it is up to other departments to follow the new policies given by