IASB Chairman Asks G20 Task Force To Turn Up Their Hearing Aids

Posted on by Caleb Newquist

Accounting rule convergence is dead. I know it. You know it. Hans Hoogervorst knows it. Everyone has accepted the fact that the SEC managed to tell IFRS supporters to stick their principles-based rules where the sun don't shine in the most passive-aggressive way possible. Yes, the IASB is still coming up with pathetic ideas to convince holdouts that they're the coolest gang of double-entry wizards around, but, really, they know it's over.

On Monday, however, we learned that the G20's Financial Stability Board is still holding on to false hope like Allan West:
"The FSB reiterates the benefits of a timely completion of convergence and considers it important that the convergence programme not lose momentum in other areas," FSB chairman Mark Carney told G20 finance ministers meeting in Mexico on Monday. "The FSB will request by no later than end June 2013 a joint IASB-FASB report on all outstanding items with a specific timetable for completion," Carney, also Bank of Canada governor, said.
IASB Chairman Hans Hoogervorst managed to withstand an aneurysm and reiterated to The Accountant that complete convergence is like The Flying Dutchman: 
Hoogersvost told The Accountant the IASB will continue to work in close cooperation with the FASB on the remaining convergence projects such as financial instruments, revenue recognition and leases but that once this work is complete “convergence will come to an end”. “I support the FSB’s call to complete these remaining projects on a timely basis. Leslie [Seidman, FSB (sic) chairman] and I have already said in public that once this work is complete, convergence will come to an end. Instead, we will work with the US on a multilateral basis,” Hoogersvost said.

Hopefully everyone's on the same page now.

Hoogervorst: IFRS unstoppable, US to make its choice [The Accountant via Matt Kelly]

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With IFRS Waiting in the Wings, Will Private Companies Get GAAP of Their Own?

This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.

A blue ribbon panel on private company accounting is holding its inaugural meeting Monday, to assess how financial reporting standards can best meet the needs of users of US private company financial statements, which are mostly for bankers and other types of lenders.

The panel, formed by the Financial Accounting Foundation, the American Institute of Certified Public Accountants and the National Association of State Boards of Accountancy, will meet five times throughout the year and will issue a report with recommendations on the future of standard setting for private companies by the end of the year.


The debate has resurfaced after the International Accounting Standard Board issued international standards for private companies last July (called IFRS for SMEs). Financial experts have been discussing this topic for decades. For instance, in 1996, the Financial Executive Research Foundation issued a paper titled “What do users of private company financial statements want?”

Some of the old and new questions the panel will address:

• What is the key, decision-useful information that the various users need from GAAP financial statements?

• Are current GAAP financial statements meeting those needs?

• How does standard setting for private companies in the US compare to standard setting in other countries, both those that have adopted IFRS for small and medium-size entities and those that have not?

To the extent that current GAAP is not meeting user needs in a cost-beneficial manner, what are some possible alternatives or private company standards?

Even if GAAP is found wanting, however, the panel might not be all that keen on IFRS as an alternative, given the limited experience of US companies with the international regime and rising skepticism on the part of the Securities and Exchange Commission about the independence of the body setting international standards.

Not that public or private US companies are eager to switch to IFRS, which will be costly and cumbersome. At this point, it seems as if private ones would rather have the accounting devil they know, except they no doubt wish it were a bit less hellacious on their results. And that’s been pretty much a forlorn hope for years.

IASB Would Prefer If India Were to Play Ball, Adopt IFRS

The International Accounting Standards Board is none-too-pleased that India has retreated from plans to fully adopt International Financial Reporting Standards this year and is a making a public push to get the country back on track. A failure to persuade India on the issue would raise serious questions about how successful IASB can be in convincing other major economies, including the U.S., China and Japan, to make a full switch. “To put it in one sentence, we strongly encourage adoption as against convergence,” IASB member Prabhakar Kalavacherla said at a conference in Mumbai last week, according to a copy of his speech, where he urged India to take a bigger role in international standard setting to address its concerns. [CFO Journal]