Standards - IASC fails to agree on valuations
Disagreements over whether to allow current market valuations on balance sheets prevented the International Accounting Standards Committee board from agreeing draft standards on investment property and agriculture at its meeting in Washington DC last week.
Board member and Reading university accountancy professor Chris Nobes said the investment property draft moved the IAS closer to UK practice, which allows property assets to be marked to their market values, with gains and losses put through the income statement.
But this was still a step too far for many international delegates. The voting was roughly 50:50 on both standards – a vote needs 75% support to be carried – which will be re-assessed after further drafting work at the board’s meeting in Warsaw in June.
The meeting also saw preliminary skirmishes about the IASC’s future direction. In December, it published a strategy paper, which would hand over responsibility for drafting standards to a new committee.
According to Nobes, the US Federal Accounting Standards Board is pushing for more power to be given to the development committee, while European bodies lobbied for the board to retain more control. ‘The UK is somewhere between these views,’ he said.
The board approved IAS 37, which supersedes IAS 10 on events after the balance sheet date and also considered developing a new standard for measuring financial instruments.