PracticeAuditUS poised to endorse IASs

US poised to endorse IASs

International accounting rules could soon receive a much sought-after boost in America as a leading US accountancy institute throws its support behind principles-based standards.

Sources close to the American Institute of Certified Public Accountants, which represents more than 330,000 US practitioners, told Accountancy Age that the US institute was poised to endorse international accounting standards over rules-based standards.

Criticism by the Securities and Exchange Commission chairman Harvey Pitt over the sluggishness of US standard-setter, FASB, and the news that international accounting standards would have forced Enron to report more about its special-purpose vehicles, will add weight to a move to IASs.

As the collapse of Enron began to unfurl in January, Pitt voiced his preference for principles over rules in accounting.

Increased support for international standards by the AICPA could exert greater influence over the SEC’s decision on how to improve its financial reporting framework, which had recently been under ferocious attack by US senators.

The European Commission is keen for the US to allow international standards to be used without reconciliation to US GAAP as soon as possible to ensure a level playing field.European listed companies must adopt IASs by 2005 at the latest, but US capital markets still demand reconciliation if foreign companies wish to list there.

Frits Bolkenstein, commissioner for the European Union’s single market, plans to ask the SEC in May why America still refuses to recognise IASs.

Sir David Tweedie, chairman of the International Accounting Standards Board, said: ‘It’s not surprising that AICPA is for principles over rules. I heard Harvey Pitt say ‘we need to put principles above rules’. That suits us.’

In a recent release from the AICPA the body has reinforced its commitment to global standards. ‘The AICPA has increased its leadership in the international standards-setting process by providing support, both staff and volunteer, to the development of new and revised IASs’.

Related Articles

PwC replaces EY as Domino's auditor

Audit PwC replaces EY as Domino's auditor

3d Alia Shoaib, Reporter
The ‘uncomfortable truth’ behind FRC’s Big Four fines recommendations

Audit The ‘uncomfortable truth’ behind FRC’s Big Four fines recommendations

1w Carl Johnson, Stephensons
BDO holds off Big Four to retain top position as AIM auditor

Audit BDO holds off Big Four to retain top position as AIM auditor

1w Alia Shoaib, Reporter
FRC urged to fine Big Four firms penalties over £10m

Audit FRC urged to fine Big Four firms penalties over £10m

3w Alia Shoaib, Reporter
EY to audit Standard Chartered bank

Audit EY to audit Standard Chartered bank

1m Alia Shoaib, Reporter
KPMG replaces PwC as Croda auditor

Accounting Firms KPMG replaces PwC as Croda auditor

2m Emma Smith, Managing Editor
EY fined £1.8m over Tech Data audit

Accounting Standards EY fined £1.8m over Tech Data audit

2m Emma Smith, Managing Editor
Top 50+50: Firms post significant growth in new tax and audit rankings

Audit Top 50+50: Firms post significant growth in new tax and audit rankings

2m Emma Smith, Managing Editor