The European Commission has criticised plans to consign the 25-year-old international accounting standards brand to the dustbin of history, and replace it with international financial reporting standards.
Standard-setters agreed to the name change in a bid to distinguish new international accounting rules from existing ones.
But the European Commission’s head of financial reporting and company law, Karel van Hulle, has objected to the plans.
Talking to IAS Board chairman Sir David Tweedie at a Paris conference last week he said: ‘Commercially it is not very good to throw away a brand.
I will have to change lots of things and tell lots of people about the name change. Why change it?’
Last year the Commission threw its weight behind a single set of global standards announcing that all European listed companies will have to adopt IASs by 2005 at the latest.
Sir David argued that the name change is crucial to plans to move forward and that it had happened in the UK when FRSs took over from SSAPs.
‘It did not cause any problems then,’ he said.
However, during his keynote speech at the conference, Sir David clearly acknowledged the value of brands when he criticised a US accounting rule.
‘In Europe we have brands like Johnnie Walker and Champagne that are older than America. I’d sooner write off America than any of those brands,’ he said.
For more on IASs, visit www.iasb.org.uk
KPMG WARNS FDS OF ‘CRITICAL’ SITUATION
KPMG senior partner Mike Rake urged finance directors to start developing a strategy for wholesale conversion to global accounting rules.
He told delegates at a Paris conference that ‘international accounting standard conversion is absolutely critical’ for Europe to compete with the US.
‘The pace of change is irresistible. But, we have 15 different sets of established accounting standards and many different regulatory environments,’ he said.
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