Concerns that attempts to standardise accounting rules worldwide will lead to a significant drop in quality and may force the US to continue demanding reconciliation to US GAAP in cross-border listing for a long time to come.
Comments by a senior figure at the US Securities Industry Association this week indicate that the US is still not ready to adopt the newly endorsed international accounting standards in an undiluted form.
The SIA which represents 7,000 US securities firms told the US accountancy watchdog, the SEC, that it would only accept standards that were of equivalent quality to US GAAP.
Frank Fernandez, senior vice president, chief economist and director of research at the SIA is reported to have said: ‘For the moment, we believe that it is premature and potentially too risky for American investors for the SEC to embrace IAS in full.’
The SEC is currently awaiting input from its consultation on whether to accept IASs from foreign companies in cross-border filings.
Sir Bryan Carsberg, IASC secretary-general, however, retained his unerring confidence in the IASs being accepted and endorsed worldwide. Carsberg said: ‘The committee is very optimistic that the US will accept the majority of IASs in cross-border listings since the SEC had been heavily involved in and fully supported of the restructuring of the IASC.
Carsberg said: ‘IASC is aiming at creating high quality standards ? I believe that most people in the US understand it isn’t acceptable for the US to write standards. We need an international body.’
Accountancy Age at IFAC 2000, Edinburgh