International standards' credibility 'threatened' by board changes
A proposed extension of monitoring powers at the head of the International Accounting Standards Board has been attacked by the ICAEW
INTERNATIONAL REPORTING standards’ credibility is at risk of being tarnished if proposed changes to the oversight of the International Accounting Standards Board go ahead, a regulator has warned.
A paper mooting the extension of the IASB monitoring board’s powers has been knocked back by the ICAEW, which warns widening its remit could undermine the independence of international standards.
Dr Nigel Sleigh-Johnson, head of the institute’s Financial Reporting Faculty, said the board “has a very important role to play in enhancing public accountability”, warning extending its scope could “endanger the credibility of international financial reporting”.
He said the structure of IFRS oversight is already complex, and argued a greater role for the monitoring board would compound the situation and potentially create overlaps.
Sleigh-Johnson cautioned the body to prioritise the information needs of investors, concluding: “If financial reporting standards were altered to suit the needs of regulators rather than investors then this confusion of objectives could lead to a loss of confidence in financial reporting, causing real damage to the capital markets.”
