US INFLUENCE over international accounting rules is at risk unless there is a “tangible sign” that it is committed to a single set of global standards, the chairman of the IASB has warned.
During a speech at an AICPA Conference in Washington to US accountants, Hans Hoogervorst urged the US to adopt international reporting standards, but hinted that its participation was no longer essential for the survival of IFRS.
Previously, it was feared that a standstill in the US over adoption of IFRS would have “very serious consequences” for the IASB because, without the US on board, Europe would go its own way and Asia would develop its own regional standards.
Hoogervorst said such talk had gone. “There is no appetite to undo this work and revert to national or regional standards. IFRS already has a global impact and that will not change. So there is no longer any risk of IFRS disintegrating as a result of a standstill in the United States,” Hoogervorst said.
The IASB’s decade-long convergence project with the US is drawing to an end, and the emergence of regional accounting standard-setting forums in Asia and Latin America has created a more multi-lateral standard-setting environment.
Last month, the IASB published proposals for a new 12-member global forum of national and regional standard setters and Hoogervorst told delegates that he expects FASB to be a “full partner” in the new venture.
“The US should remain an important participant in our institutions and activities. But obviously, US influence will be commensurate with its commitment to our standards,” he said.
“It will make a huge difference whether the FASB will be in a position to endorse our standards, instead of being a national standard setter without a role towards IFRS.”
Hoogervorst said that in the absence of a “credible, tangible step” on the part of the US, international concern over its participation could turn into international scepticism.
“The G20 calls for global accounting standards would start to ring increasingly hollow. We cannot allow that to happen,” he said.
The FRC has banned two former Connaught finance directors responsible for a £4m accounting misstatement at the collapsed social housing maintenance provider
The UK’s decision to leave the EU has raised questions about whether the FRC's regulatory framework should change in the future
EU accounting and taxation legislation may not apply in Britain as PM says 'Brexit means Brexit'
Company boards must pay more attention to instilling the right corporate culture in order to restore trust in business and deliver long-term sustainable growth, according to the FRC