Canada’s move to adopt International Financial Reporting Standards will improve transparency and comparability of Canadian enterprises will their peers in most countries, but not the United States, says Moody’s Investors Service.

In a report released Monday, Moody’s says that Canada’s move to IFRS “is consistent with the global trend of convergence towards a single set of globally accepted accounting standards” and, while it should improve comparability with companies worldwide, “comparability may actually become more challenging for some Canadian enterprises”, if most of their peers are based in the U.S. and report under U.S. accounting standards.

It notes that U.S. standards are more closely aligned with Canadian GAAP than IFRS is. “Unfortunately, the U.S.’s position with respect to if, when and how to adopt IFRS is subject to heightened uncertainty at the moment, since the SEC is still in the information-gathering and assessment phase of determining the future path of U.S. accounting in this area,” it says.

Additionally, the rating agency says that it doesn’t expect any big rating changes for Canadian firms due to the new standards. “Overall, the transition is unlikely to have a broad impact on credit ratings,” said Anna Zubets, Moody’s vice president and senior accounting analyst, “as a change in the medium of communicating financial results does not usually have a significant impact on the economic position of an entity.”

She notes that there are many important differences between current Canadian standards and IFRS, “which can complicate the financial performance analysis of transitioning companies in the year of adoption and beyond.”

The most critical reported credit metrics, such as EBITDA, funds from operations, capital expenditures and financing cash flows can change because of the transition to IFRS, the report said. It stressed that, “when analyzing companies undergoing an accounting conversion, it’s critical to be able to distinguish between changes that are directly attributable to a different accounting language and those that reflect differences in underlying business performance.”