The International Accounting Standards Board (IASB) and USA's Financial Accounting Standards Board (FASB) have jointly completed the second phase of the business combinations project paving the way yesterday for IASB to release the revised version of IFRS 3 Business Combinations and an amended version of IAS 27 consolidated and separate financial statements. The new requirements will come into force on July 1, 2009, although businesses can adopt them earlier.
IASB said that, in publishing its equivalents to IFRS 3 and IAS 27, FASB had made fundamental changes to its accounting for business combinations, most of which brought US accounting in line with the existing IFRS 3 and IAS 27.
Other improvements would change both IFRSs and US GAAP. The revised IFRS 3 reinforced the existing IFRS 3 model but remedied problems which had emerged in its application.
Commenting on the announcement, Sir David Tweedie, IASB Chairman, said the accounting requirements in IFRSs and US GAAP would now be substantially the same, 'thanks largely to the changes that the FASB has made to US GAAP. The changes to IFRSs have, in contrast, been relatively small,' he said.
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