THE UK's reporting watchdog has been named as one of 12 national and regional standard setters that will sit on a body that provides technical advice to the IASB.
The FRC will be joined on the forum by standard setters from Africa, Europe, Asia and the Americas to help the IASB set international reporting standards. Membership of the group, known as the Accounting Standards Advisory Forum, will be reviewed after two years by the trustees of the body that oversees the IASB.
US standard setter FASB was also chosen to participate on the forum, despite the US having failed to adopt IFRS during a ten year convergence project between the two accounting boards.
Some of the criteria in the IASB's initial proposals, namely commitments to promote a single set of global standards, were expected to deter the likes of FASB from joining together; though this was later watered down to allow members to support the IASB in its mission to promote IFRS rather than promote the standards themselves.
Jeffrey Diermeier, chairman of FASB's oversight board of trustees, said participating in the forum "is an opportunity to represent US interests in the IASB's standard-setting process and to continue the process of improving and converging US GAAP and IFRS."
Japan - which like the US has been weighing the pros and cons of adopting IFRS - will be represented on the forum by the Accounting Standards Board of Japan, though the group is not a vehicle designed to just enlarge the IFRS community. The majority of members already use IFRS.
"The choice of members for the ASAF shows a sensibly sharp focus on key national standard setters from major capital markets," said Nigel Sleigh-Johnson, head of ICAEW's financial reporting faculty.
The forum's creation is part of the IASB's decision to take a more collective approach to standard-setting in favour of the unique bilateral arrangements previously enjoyed by the US and Japan.
"The creation of the ASAF reflects two important changes in the global accounting standard setting landscape. First, the significant growth in the use of IFRSs around the world has complicated the task of maintaining bilateral Memorandum of Understandings with multiple jurisdictions. Second, many parts of the world have established regional accounting standard-setting organisations and forums to offer advice and to discuss matters related to IFRS," said Michel Prada [pictured], chairman of the IFRS Foundation Trustees.
The first meeting of ASAF is scheduled to take place in London on 8 and 9 April 2013. The dozen members - whittled down from 25 initial nominations - are as follows:
South African Financial Reporting Standards Council, supported by the Pan African Federation of Accountants (PAFA)
Accounting Standards Board of Japan
Australian Accounting Standards Board
Chinese Accounting Standards Committee
Asia Oceania Standard Setters Group (AOSSG), represented by the Hong Kong Institute of Certified Public Accountants
Accounting Standards Committee of Germany
European Financial Reporting Advisory Group (EFRAG)
Spanish Accounting and Auditing Institute
Group of Latin American Standard Setters (GLASS), represented by the Brazilian Committee of Accounting Pronouncements
Canadian Accounting Standards Board
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