EU standard setters wade into IFRS debate

by Richard Crump

More from this author

08 Feb 2013

  • Comments
Financial Reporting Council

EUROPEAN STANDARD SETTERS have joined forces to influence how the framework that underpins international accounting rules will be revised.

The UK's Financial Reporting Council has joined with the national standard setters of France (ANC), Germany (ASCG), Italy (OIC), and with European standard setters' advisory group EFRAG to influence the debate over the future of IFRS.

Global standard setter the IASB is currently revising the conceptual framework that underpins the way the it develops and rewrites accounting standards, with its chairman Hans Hoogervorst demanding that it be treated as the board's "main deliverable" focus over the next three years.

Last month, the FRC, which hiked its levy rates to - among other things - strengthen its ability influencing the international debates on auditing and international reporting standards, said revising the conceptual framework was "critical" for the future of IFRS.

By collaborating with its European partners the FRC hopes to make sure the revised conceptual framework reflects an underlying accounting model relevant to European stakeholders.

Additionally, the standard setters have published a joint consultation paper from the standard setters, Getting a Better Framework, to illustrate some of the major issues that will arise in the development of the new framework, and to encourage others within Europe to engage in its development.

"Given the vast scope of the project, and in order to facilitate obtaining input from European stakeholders in an open and proactive way, the accounting standard bodies have agreed to publish bulletins each covering a topic as well as a regular newsletter on project updates," the FRC said.

Speaking at the IASB's September board meeting, Hoogervorst said revising the framework was urgent because the board is "struggling with so many basic questions in terms of measurements".

One issue that provoked controversy was the removal of prudence from the framework to be replaced by the concept of neutrality; a decision recently described by former UK chancellor Lord Lawson as "a stupid thing to do".

Hoogervorst has argued that the basic tenets of the concept of prudence remain intact and visible throughout IFRS. According to the standard setters' consultation paper, "it remains open to question, however, whether the framework should specifically refer to prudence and what precisely prudence means".

Visitor comments

blog comments powered by Disqus

Add your comment

We won't publish your address

By submitting a comment you agree to abide by our Terms & Conditions

Your comment will be moderated before publication

  • Send

Charterhouse Accountants

Finance Officer

Charterhouse Accountants, Beaconsfield, Permanent, Full Time, £ Competitive




Get the latest financial news sent directly to your inbox

  • Best Practice
  • Business
  • Daily Newsletter
  • Essentials


Search for jobs
Click to search our database of all the latest accountancy roles

Create a profile
Click to set up your profile and let the best recruiters find you

Jobs by email
Sign up to receive regular updates with the latest roles suitable for you



Why budgeting fails: One management system is not enough

If budgeting is to have any value at all, it needs a radical overhaul. In today's dynamic marketplace, budgeting can no longer serve as a company's only management system; it must integrate with and support dedicated strategy management systems, process improvement systems, and the like. In this paper, Professor Peter Horvath and Dr Ralf Sauter present what's wrong with the current approach to budgeting and how to fix it.


iXBRL: Taking stock. Looking forward

In this white paper CCH provide checklists to help accountants and finance professionals both in practice and in business examine these issues and make plans. Also includes a case study of a large commercial organisation working through the first year of mandatory iXBRL filing.