Big Five - IFAC rejects audit police role

The International Federation of Accountants this week rejected a plan under which it would police the conduct of audits by international firms.

IFAC president Frank Harding dismissed the proposal that IFAC should form an oversight committee, which was put forward by Zubaidur Rahman in a report on the east Asian financial crisis commissioned for the UN Conference on Trade and Development.

‘It is not practical for IFAC to carry out a monitoring role of individual firms in different countries, but we can try to ensure that countries do comply with international standards,’ he said.

The International Accounting Standards Committee board met in Zurich this week to discuss its draft standard on financial instruments and derivatives – the last and most controversial standard in its core package. The IASC is aiming to complete this project at a meeting next month.

In the past two weeks, the European Commission and G7 finance ministers have called for securities bodies to accept IASs for cross-border listings.