In 2025, IFRS Implementation Data Gaps continue to pose a major challenge for UK corporates. As new standards—IFRS 9, 15, 16, 17, and the IFRS Sustainability Standards—are progressively enforced, gaps in data systems and governance frameworks are threatening finance teams’ ability to deliver accurate, compliant financial reports. Left unresolved, these gaps can undermine financial reporting accuracy, hinder regulatory compliance, and stall finance transformation efforts. The causes, impacts, and comprehensive solutions for closing IFRS Implementation Data Gaps, and empowers finance leaders with a clear strategic action plan.
Understanding IFRS Implementation Data Gaps
IFRS Implementation Data Gaps refer to deficiencies in data quality, completeness, timeliness, or integration that prevent organisations from fully complying with IFRS requirements. Common sources of these gaps include:
- Siloed systems (e.g., sales contracts in CRM vs finance systems)
- Over Reliance on spreadsheets and other manual tools
- Temporary fixes used during deadlines without proper redesign
- Legacy IT systems unable to support new data requirements
Each of these increases the risk of reporting inaccuracies, non-compliance, and inefficiency.
Why the Issue Is Urgent in 2025
Several recent developments have heightened the importance of closing IFRS Implementation Data Gaps:
- In 2025, the Financial Reporting Council (FRC) strengthened audit and risk oversight, including tighter expectations on reporting data quality.
- PwC’s March 2025 accounting reminders highlighted increased scrutiny of IFRS 9, 15, and 16 disclosures.
- UK CFOs report that data reliability, timeliness, and accuracy are among their top three concerns.
- The upcoming adoption of IFRS S1/S2 sustainability standards will bring new data-intensive disclosure responsibilities.
Compliance isn’t enough—2025 demands integrated, transparent, and governed finance data.
Standards Driving New Data Needs
IFRS 9 – ECL Model
- Requires historical payment data, forward forecasts, and credit model inputs.
- The PRA and FRC note that many first-generation ECL models lacked sufficient data integrity.
- IFRS Implementation Data Gaps arise where credit risk and macro-economic variables aren’t properly integrated into finance systems.
IFRS 15 – Revenue Recognition
- Calls for contract-level detail on deliverables, pricing, and timing.
- With UK GAAP aligning to IFRS 15 in 2026, mid-size firms face rising data expectations.
- Data silos between CRM and finance cause recognition misalignment and disclosure risk.
IFRS 16 – Leases
- Obliges on-balance sheet recognition of lease liabilities and right-of-use assets.
- Over half of companies continue using spreadsheets post-2019, increasing risk.
- IFRS Implementation Data Gaps are most visible when new leases aren’t captured or assumptions go unlogged.
IFRS 17 – Insurance Contracts
- Data challenges here impact insurers but highlight enterprise lessons: actuarial, finance, claims, and reinsurance systems must be integrated.
- This requirement mirrors systemic changes needed across other sectors.
IFRS S1/S2 – Sustainability Reporting
- Requires non-financial metrics on ESG risks and opportunities.
- Finance departments are now custodians of both monetary and non-monetary data consistently and transparently.
Consequences of Ignoring Data Gaps
- Regulatory and audit breaches: FRC warnings, potential fines, and audit reservations can stem directly from IFRS Implementation Data Gaps.
- Earnings volatility and misstatement: Lease miscalculations, revenue recognition errors, or under-provisioned credit loss models undermine stakeholder confidence.
- Operational inefficiencies: CFO respondents say 32–40% of their time is spent reconciling data.
- Missed strategic insight: Disconnected datasets block scenario analytics and ESG planning—critical in 2025’s dynamic environment.
Best-Practice Framework to Close Data Gaps
Data Governance & Ownership
- Assign data stewards for contracts, leases, credit data, ESG metrics.
- Create data dictionaries explaining format, source, process owner.
- Automate metadata checks for completeness and accuracy.
- Form a Data Governance Council with defined KPI targets.
Systems Integration & ERP Modernisation
- Deploy modules for IFRS 9, 15, 16 directly within ERP systems.
- Use APIs or ETL tools for CRM, contract, or procurement system integration.
- Consolidate leases in a single lease system for accurate IFRS 16 compliance.
- Remove spreadsheets entirely, automating data capture processes.
Control Automation & Data Validations
- Use RPA and reconciliation engines to catch errors early.
- Define thresholds for anomalies (e.g. variance in revenue recognition).
- Automate IFRS disclosures (lease schedules, ECL movements, ESG metrics).
Cross-Functional Working Groups
- Form IFRS implementation teams with finance, IT, legal, operations, and risk representation.
- Meet regularly to review data workflows and close process gaps.
- Conduct training for operational teams on new data demands.
Upskilling Finance and Data Teams
- Provide training on technical IFRS standards and digital tools.
- Incorporate analytics, AI, and sustainability measurement into roles.
- Consider data-focused hybrid functions to bridge finance and systems.
External Assurance & Regulatory Alignment
- Perform internal audits targeting data completeness and controls.
- Consult auditors and peers to benchmark data stewardship.
- Monitor FRC and FCA thematic reviews to ensure compliance.
2025 Action Plan for Finance Leaders
|
Timeline |
Action |
| Q2 2025 | Conduct a holistic data gap analysis across IFRS standards. |
| Q3 2025 | Launch governance programme; set stewardship and KPI objectives. |
| Q4 2025 | Fully integrate and automate lease and revenue modules. |
| Q1 2026 | Prepare systems IFRS S1/S2 ESG data requirements. |
| Ongoing | Automate controls and foster cross-department data collaboration. |
| Annual | Report governance progress and KPI results to the board and audit. |
Benefits Beyond Compliance
By closing IFRS Implementation Data Gaps, organisations can expect:
- Faster, more reliable financial closes
- Reduced audit effort and risk
- Better strategic insights and ESG readiness
- Elevated trust among investors and regulators
This contributes not just to compliance, but resilience and strategic agility in the evolving 2025 UK landscape.
How Insights UK Can Help You Close IFRS Implementation Data Gaps
Successfully addressing IFRS Implementation Data Gaps demands more than internal process improvements—it requires strategic expertise, regulatory alignment, and smart technology integration.
As a trusted advisory and technology partner to UK corporates, Insights UK specialises in finance transformation, IFRS compliance, and data governance services tailored to the 2025 landscape.
Services Tailored to This Challenge:
- IFRS Data Diagnostic & Gap Analysis: Comprehensive reviews of your organisation’s IFRS reporting and supporting data ecosystems, identifying system disconnects and process blind spots across IFRS 9, 15, 16, and 17.
- ERP & System Integration Support: Configuration and deployment of IFRS-specific ERP modules (lease, revenue, financial instruments), as well as end-to-end system integration between operational and finance platforms.
- Automated Reporting & Disclosure Solutions: Streamlining your IFRS disclosures with automation tools that improve control, reduce reporting timelines, and ensure accuracy under FRC scrutiny.
- Data Governance Frameworks: Establishing cross-functional data stewardship models, control KPIs, governance councils, and ESG-ready data models aligned with IFRS S1/S2 requirements.
- Specialist Training for Finance Teams: Targeted training programmes to upskill finance, risk, and IT teams in IFRS data requirements, system use, and audit readiness.
In the era of new IFRS regimes and heightened regulatory expectations, IFRS Implementation Data Gaps are more than technical hurdles—they are strategic threats. UK finance leaders must seize this moment to invest in data governance, ERP integration, automation, and cross-functional alignment. Those who do will secure stronger finance functions that are accurate, compliant, and transformational.
Leading with data integrity positions finance not as a gatekeeper but as a strategic enabler—ready for sustainability demands, digital transformation, and tomorrow’s challenges. The roadmap is defined; the time to act is now.