Osborne to review standard setters' accountability

CHANCELLOR GEORGE OSBORNE questioned standard setters' accountability in a House of Commons debate on Monday.

Describing them as "very powerful institutions", he said: "They are not really accountable to national parliaments or international bodies that represent national governments."

The Financial Stability Board might act to make global standards more accountable, Osborne (pictured) revealed, saying "discussion is going on" about how this could be achieved.

He promised to look again at the incentives and risks behind International Financial Reporting Standards, adding: "One of the discussions going on in international circles at the moment is how to make all the various standard-setting bodies more accountable."

Osborne's comments came after a line from Steve Baker MP, who  questioned the adequacy of accounting standards and said the recent Vickers Report on banking reform "takes [this] for granted".

National standard setters answer to individual governments but the International Accounting Standards Board is managed by trustees who, in the absence of supranational government, are overseen by the monitoring boards of public authorities in various jurisdictions.

The IASB's own monitoring board is currently undertaking a governance review and accountability could be up for consideration.

In the meantime, Osborne's suggestion that the Financial Stability Board could play a part may throw up different challenges, as the IASB is a member.