Gang of four unites to derail IAS39
The fate of international accounting standards in Europe is balanced on a knife edge after opposition to the endorsement of financial instruments standard IAS39 gathered momentum.
Link: UK piles pressure on EU to settle IAS39 row
At a meeting of the European Commission’s accounting regulatory committee earlier this week, four nations – France, Belgium, Italy and Spain – said they opposed the use of IAS39 in its current form by the EU’s listed companies in the EU from 2005. Six others – Germany, Portugal, Slovakia, Slovenia, Luxembourg and Malta – abstained while the remaining 15, including the UK, voted in favour.
The EC is now waiting for the member states to confirm their views in writing by 30 June. It could take as few as two of the abstaining states to come out against adoption of IAS39 in their written view to create a blocking minority, which would derail the implementation of the standard.
‘The commission will clarify the way it intends to move forward with IAS39 once it has the definitive view of member states and of EFRAG,’ said a commission spokesman.
EFRAG, the EC’s accounting advisers, has published a consultation document proposing endorsement, even though more than half of its members voted against the standard. However, EFRAG’s rules require a two-thirds majority to recommend non-endorsement.
Failure by the EC to adopt the standard would severely damage the chances of eventual convergence of international standards with US accounting standards.