Accounting standard-setters have been branded undemocratic and ‘arrogant’ for failing to change the principles of reporting to reflect global economic changes.

David Middleton, emeritus professor of Finance and Accounting at Cranfield School of Management has described the International Accounting Standards Board, IASB, and the European Union as alike in their failure to consult.

‘There are striking similarities between the IASB and the European Union. Both are driven by well-meaning, intelligent, determined people. But they seem unable to listen to reasoned disagreement or to trust people to exercise their own judgment,’ wrote Professor Middleton in a letter to the Financial Times.

He added that 12 years ago the then six leading British accountancy firms expressed ‘grave doubts’ about the UK Accounting Standards Board's draft statement of principles of financial reporting and its practical implications.

But despite this, the final version of reporting principles, which largely derived from the American Financial Accounting Standards Board's framework, was ‘little changed’, he claimed.

His comments follow an earlier letter, which also appeared in the Financial Times, from Michael Starkie, a former chairman of the UK's CBI financial reporting panel and chief accountant for BP.

Starkie accused the IASB of ‘wasting’ an opportunity to change the principles to reflect changes in global markets as US influence has waned.

In particular, he was critical of the mark-to-model exit values in balance sheets, which he maintains are unhelpful for assessing the economic position of companies wishing to continue as going concerns.