CIMA warns G20 against 'knee-jerk' reaction

The UK's leading management accountancy institute has urged the G20 not to take a 'knee-jerk' reaction to the financial crisis.

CIMA submitted a representation to the high-profile summit in which it said a ‘knee -jerk reaction could have unintended consequences,' calling on world leaders to maintain confidence in financial reporting by keeping faith with the IASB.

CIMA said: 'It is important that the IASB should remain an independent standard setter, without political interference, whilst subject to appropriate international oversight and accountability.

Last year, the IASB relaxed fair value rules largely to avoid a larger carve-out threatened by EU mandarins.

'In our view, fair value accounting with appropriate disclosure remains the most appropriate measurement model for certain financial instruments, providing timely, important and transparent information.The current financial crisis is principally an economic issue not an accounting one,' CIMA added.

Further reading:

Tweedie nearly quit after fair value change