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Russia's Adoption of IFRS Could Bring Investment Opportunities

Russia's adoption of IFRS could make investing in the country more simple.

Starting next year, all Russian public companies will be transitioning to the International Financial Reporting Standards (IFRS), and by 2013 will be publishing their accounts according to the rules, Bloomberg reports. Currently, approximately one-third of publicly traded businesses do not follow IFRS, the source says, citing a report from the newspaper Kommersant.

As Reuters noted earlier in December, Russian officials were pushing for the mass migration to IFRS, since many investors and analysts view the international set as "a more reliable source of financial information than (the Russian Accounting Standards)."

The development may prove burdensome to corporations in the country, which will be forced to report under RAS and IFRS by 2015, according to Russia Today. Yet Finance Minister Anton Siluanov told the source that because IFRS is considered "an important indicator of stability, credibility and transparency of management," international businesses may take a greater interest in the country's economy.

However, other events could actually deter dealings with Russia, as political protests surrounding the recent presidential election could be breeding uncertainty and making investors skittish about putting their funds in the region, Nasdaq reports.

"One thing is certain, however. Few thought Russia's path to becoming an international finance center (would be) be smooth," the news outlet concludes.