Concerns have arisen that the IASB is moving over to a rulebook approach, as preferred in the US, following the global standard setter’s consultation on changes to the preface of international rules.
But Sir David Tweedie, chairman of the IASB denied the board was shifting to a rulebook approach. ‘Principles are far better than rules,’ he said
In its response to the consultation the UK’s Accounting Standards Board said ‘standards should focus on principles and show how more detailed requirements derive from those principles. This will reduce the need to elaborate a further rule for every new transaction.
‘It should also assist in engendering a greater readiness to comply with the spirit, not just the rules, of accounting standards.’
Brian Shearer, technical partner at Grant Thornton, said: ‘Abandoning the bold type/plain type distinction is an indication that the IASB may be considering a move towards rules based accounting. If a rulebook approach were adopted, it could significantly damage the credibility of standards and of the standard setter.’
The ASB put less importance on the proposals to change the style of typeface but said it ‘would strongly prefer IASB to retain the style of IASC standards’.
Both Grant Thornton and the ASB urged the IASB to explore ways of enabling not-for-profit organisations to produce accounts using its standards. IASB currently only develops standards for public listed companies.
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