# IFRS 15: Moving away from short-term fixes is vital for effective compliance Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-09-07 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: How Automation Can Help Businesses Comply with IFRS 15 Meta Description: Discover how automating financial reporting processes can streamline compliance with IFRS 15 regulations and reduce the risk of errors and reputational damage. URL: https://financedigest.com/ifrs-15-moving-away-from-short-term-fixes-is-vital-for-effective-compliancehtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/istock-943331302-1736815265368-compressed.jpg) _![](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/105-1736815265374-compressed.jpg)_ _By **Nathan Shinn,** Founder and CSO,_ [_BillingPlatform_](https://billingplatform.com/) New regulations, and complying with them, are always a challenge for businesses when they come into place, particularly when they focus on financial processes. There are many regulations that have been high on the agenda for financial teams over the last few years. Arguably the biggest of these is [IFRS 15, introduced by the International Accounting Standards Board (IASB)](https://www.iasplus.com/en/standards/ifrs/ifrs15), and its US counterpart, [ASC 606 Revenue from Contracts with Customers (“ASC 606”)](https://www.iasplus.com/en-us/standards/fasb/revenue/asc606). Since it came into effect in 2018, IFRS 15 has meant that many businesses – particularly their finance teams – have had to drastically change how they report financial statements. This is due to the nature of the regulation, which aims to eliminate variations in the [way firms across a range of industries](https://www.financedigest.com/5-ways-the-fs-industry-can-support-the-recovery.html "5 ways the FS industry can support the recovery") handle accounting for similar transactions, and firms must now include much more detailed, complex information in these statements. For the most part, companies have adapted, making the necessary [changes to ensure compliance](https://www.financedigest.com/the-lego-blocks-of-saas-how-microservices-can-help-ensure-compliance-with-changing-financial-regulations.html "The Lego blocks of SaaS: how microservices can help ensure compliance with changing financial regulations"). However, while businesses, CFOs, and finance teams may have done what was needed, in many cases they have had to prioritise a short-term [solution to ensure](https://www.financedigest.com/vias-cloud-based-solutions-ensure-painless-office-move-for-insurance-body.html "VIA’S CLOUD-BASED SOLUTIONS ENSURE PAINLESS OFFICE MOVE FOR INSURANCE BODY") they could comply quickly, implementing processes that have fast become a pain point. Many businesses have put in place manual reporting processes, with financial statements being prepared by the [finance team and then signed-off by the executive branch of the organisation](https://www.financedigest.com/cyber-threats-for-finance-organisations-to-watch-in-2023.html "Cyber threats for finance organisations to watch in 2023") before being reported publicly. While this [way of working](https://www.financedigest.com/five-ways-to-keep-your-head-above-water-while-working-from-home.html "Five ways to keep your head above water while working from home") seems logical and straightforward, the complex nature of these documents, especially if working on multiple different statements, means that compiling these and receiving sign-off manually can lead to errors being missed and, as a result, blame being placed squarely at the executive branch. This can have serious ramifications for a [company if it appears as though the executive branch has misreported or even lied on an important financial](https://www.financedigest.com/how-can-financial-services-companies-compete-more-effectively-in-times-of-uncertainty.html "How can Financial Services Companies compete more effectively in times of uncertainty?") statement, and could result in huge reputational damage, and shareholder trust being shaken or lost. **Automate to regulate** With the aforementioned risks being placed upon businesses which try to comply with IFRS 15 through manual, complicated processes, firms and their [financial teams need to be looking for ways](https://www.financedigest.com/5-ways-to-improve-your-financial-literacy.html "5 Ways to Improve Your Financial Literacy") they can streamline the development of these reports. To do this, [businesses are starting to turn](https://www.financedigest.com/6-expert-tips-to-turn-your-photography-passion-into-a-business-2.html "6 Expert Tips to Turn Your Photography Passion into a Business") to technology and automation. Companies that want to [avoid the risk that comes from manual reporting are looking for systems that can create](https://www.financedigest.com/5-mistakes-to-avoid-when-creating-passive-income.html "5 Mistakes to Avoid When Creating Passive Income") financial statements automatically and remove the need for finance teams and executives to take a hands-on approach to their development. **There’s no one-size-fits-all solution** Automation is, without doubt, a [step in the right direction to ensure a business](https://www.financedigest.com/how-to-start-an-ecommerce-business-easy-steps-to-get-started-with-an-ecommerce-business.html "How to Start an Ecommerce Business – Easy Steps to Get Started With an Ecommerce Business") is compliant with IFRS 15, but it alone is not enough. Revenue and [cash flow](https://www.financedigest.com/how-smes-can-improve-cash-flow.html "How SMEs can improve cash flow") implications vary from contract to contract, which is why many have chosen to compile these statements manually in the first place, to maintain control. This is why [businesses can’t focus solely on automation](https://www.financedigest.com/breaking-down-the-barriers-of-ar-automation-to-help-businesses-save-money.html "Breaking down the barriers of AR automation to help businesses save money ") when putting solutions in place, but must also look for flexibility. [Technologies which support financial](https://www.financedigest.com/shakedown-on-horizon-for-financial-technology-world.html "Shakedown on horizon for financial technology world") reporting need to allow businesses to implement rules and formulas on a report-to-report basis. This will mean that changes can be made where needed, and that accuracy can be guaranteed, [removing the risks inherent in both manual reporting](https://www.financedigest.com/removing-the-month-end-headache-in-financial-reporting.html "Removing the Month-End Headache in Financial Reporting ") and in taking a one-size-fits-all approach. New regulations [bring with them new challenges that businesses](https://www.financedigest.com/4-ways-moving-office-can-bring-your-business-roi.html "4 ways moving office can bring your business ROI") have to prepare for, as seen with IFRS 15. But [complying with new regulations](https://www.financedigest.com/triggered-by-regulation-why-the-need-to-comply-is-driving-financial-services-firms-to-adopt-data-management-best-practice.html "Triggered by Regulation – Why the Need to Comply is Driving Financial Services Firms to Adopt Data Management Best Practice") shouldn’t mean compromising on efficiency or accuracy. Through implementing solutions that can help companies comply with financial regulations in an accurate, secure and flexible way, everyone from the [finance team through to the CEO and shareholders can rest easy knowing that the financial information they are making public](https://www.financedigest.com/2019-year-must-re-build-public-trust-finance.html "2019 is the year we must re-build public trust in finance") is of the highest standard, now and going forward. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---