A charm offensive was launched in Brussels this week by the International Accounting Standards Board, which stands accused by MEPs of being ‘undemocratic’.

New chairman of the board of trustees Gerrit Zalm was meeting Alexander Radwan MEP, who authored a report earlier this year criticising the body. The parliamentarians are currently crossing swords with the body over the segmental reporting standard IFRS 8.

Radwan wrote in the report: ‘It is not clear how [the IASB’s] work plan is developed, how its mandates are formed, how and against which criteria its members are chosen, or how it takes into consideration the interests of stakeholders (including those preparers and users that are required by law to apply international accounting standards).’

The IASB was criticised about the contentious segmental reporting standard, IFRS 8, which was this week adopted with instructions that it be reviewed two years after it is in place. IFRS 8 requires accounts to be filed ‘through the eyes of management’ as is done in the US, where the standard originated.

‘Governance and accountability must be improved,’ Radwan wrote. The report is still in a draft stage and subject to amendments. The IASB’s chairman Sir David Tweedie this week conceded that the body may need a committee to oversee its actions. The body is set to announce further plans imminently.

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