UK piles pressure on EU to settle IAS39 row
The UK government and influential accountancy body FEE are heaping pressure on the European Commission and the banking community to reach a compromise over troublesome accounting standard IAS39.
Link: IAS special report
Representatives from the European Banking Federation and the International Accounting Standards Board have been locked in talks this week in the hope of finding common ground over presentational issues relating to cashflow hedging in the financial instruments standard.
The commission has already stated that it will refuse to endorse the standard unless this issue is resolved, and it wants the IASB to commit to exploring fundamental changes to the standard in the medium term.
But this stance is now causing concern within the UK government, which sees the prospect of introducing international financial reporting standards in Europe next year without IAS39 as potentially very damaging.
‘The government has made it clear to the commission that the adoption of all standards is essential to the success of the EU’s approach to accounting harmonisation,’ said minister for state and industry Jacqui Smith in a parliamentary statement.
The European accountancy body FEE expressed its displeasure with the possibility that the commission might go ahead without IAS39.
‘The endorsement process should not be used as a means to create European standards,’ said FEE president David Devlin. ‘There would be serious drawbacks