China vows to endorse IFRS

ICAEW members heard one of China’s finance ministers endorse IFRS this week ­
but his comments came only after they had heard their own leader issue a stark
warning about the low level of awareness in the UK about the new rules.

China’s assistant finance minister Wang Jun told yesterday’s ICAEW conference
that international accounting and audit standards had become an ‘inevitable
trend’ and pledged to converge his own country’s standards.

But institute chief executive Eric Anstee spoke of the poor level of
knowledge among UK-listed companies about the effects of IFRS on key performance
indicators.

ICAEW research released at the conference found that 58% of listed companies
were ‘unaware’ of how IFRS would impact their KPIs, while only 36% have issued
public statements quantifying the impact of the standards upon their 2003 or
2004 results. ‘Many can’t express a view on its impact,’ Anstee said, adding
that it was ‘disturbing’.

Wang said: ‘The convergence of IFRS and audit standards has become an
inevitable trend.’ While local legal systems, accounting and audit objectives
naturally differ, he added, the Chinese government will actively promote
convergence.