PracticeAuditEuropean Union green lights IASs by 2005

European Union green lights IASs by 2005

Official approval of an international set of accounting standards for Europe by 2005 has been given by Council of Ministers of the European Union after the regulation was proposed by the European Commission.

IASB chairman Sir David Tweedie called the decision of the EU a ‘watershed’ event in his organisation’s attempts to have a harmonised set of a standards across member states.

Under the regulation, all publicly-quoted companies in member countries will be required to use International Accounting Standards and International Financial Reporting Standards by 1 January 2005.

There will be a temporary exception for companies that are currentlytraded in the United States and use US generally accepted accounting principles and for companies that have issued debt instruments but not equity instruments. These companies will have until 1 January 2007 to comply.

‘Having the support of the European Union is a significant step forward in the movement towards the development and acceptance of a single set of high quality international accounting standards,’ Tweedie said.

He added: ‘The IASB has just recently completed its first proposals aimed at improving existing standards. In the coming weeks and months we shall be focusing our attention on continued improvements, easing implementation of the standards, and worldwide convergence.’

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