Conversion to IFRS in the postal sector

The Issue

The company (one of the largest postal delivery services in Africa) was instructed by its stakeholder (the government) to prepare is next annual financial statements in accordance with IFRS. The company decided three months before its year end to undertake an IFRS conversion. It was imperative to the reputation of the company to meet this requirement. PwC were engaged to advise and assist the company in meeting this tight deadline.

Our Approach

PwC commenced the engagement with an analysis of local GAAP to IFRS (in order to identify the GAAP differences), as well as an IFRS 1 – First time adoption of IFRS , analysis (in order to determine the impact of the exemptions under IFRS 1 on the company). Workstreams per accounting area (e.g. revenue recognition, financial instruments, property, plant and equipment, etc) were then set up with a PwC and a company representative taking ownership of each workstream. This was crucial to the success of the project in order to achieve knowledge so that when PwC completed the engagement, the knowledge stayed within the company.

The Outcome

Within five months, the company produced its fist set of IFRS annual financial statements where the company was able to take into account its strategic goals as part of the conversion process. PwC is continuing to assist the company in building further on the initial conversion by embedding IFRS into its business as usual activities as well as ensuring sustained reporting under IFRS. As such, the financial reporting capability of the company has improved substantially.