Findings from PricewaterhouseCoopers' (PwC's)
11th Annual Global CEO Survey point clearly to the fact that the world economy is no longer dominated by the US and other developed countries. Success in this rapidly evolving environment requires competing in one global marketplace, and not a series of regional ones. This adjustment will be difficult, but the rewards are significant. Those accustomed to years of market leadership will need to begin shifting their domestic and regional focus toward greater integration with the global economy if they are to rise to the challenge of the new economic reality.
An environment of constant change demands a new approach to business strategy. While creating efficiencies and cutting costs through process standardization and IT investment was once an effective way to create competitive advantage, companies are now finding themselves bogged down by inflexible systems and processes. Companies must reclaim the right balance of standardization and flexibility and develop a new core competency: agility.
Recently released accounting standards introduce pervasive changes to how companies track and report M&A. Two deserve particular attention: expensing transaction and restructuring costs, and the broader use of fair value concepts.
International Financial Reporting Standards (IFRS), the framework used by most of the world today, has growing support in the US. So much so, in fact, that within a few years the SEC may designate a date for mandatory adoption of IFRS by all US public companies. When IFRS conversion comes, it will be beneficial for a number of reasons.
