US companies await SEC rules verdict

Companies listed in the US will find out today whether they will have to
continue filing statements reconciling their accounts with US accounting rules,
as the Securities and Exchange
votes on the issue.

The Financial Accounting Standards Board in the US appeared to put a spanner
in the works this week, calling for a delay to the move, which will make life
much easier for foreign companies listed in the US.

The FASB said that any moves to remove the ‘reconciliation statement’, as it
is known, should only take place when there is a timetable in place to move all
companies to IFRS and to properly fund the International Accounting Standards

‘We acknowledge the concerns of those who believe eliminating the
reconciliation would be premature and would result in a loss of information that
some investors find important… the number of SEC registrants affected by this
change appears relatively small when compared to the overall size of our capital
market,’ Robert Herz, chairman of FASB, and Robert Denham, FASB oversight body
chairman, said in a joint letter to the SEC.

The FASB believes that permitting choice between US GAAP and IFRS for US
companies could lead to a two-GAAP system, which would be unnecessarily complex
for users of financial information.

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Fiona Westwood of Smith and Williamson.