IFRS Foundation Trustees Issue Statement in Response to SEC Staff Report

IFRS Foundation trustees have given a statement on the staff report published by the SEC (Securities and Exchange Commission) on the plan of work for global accounting standards.

According to the statement SEC has regretted the fact that the report does not come with an action plan for Securities and Exchange Commission.

Michel Prada, the Chairman of the Trustees clarified in his statement that for both the benefit of both international stakeholders and United States, the IFRS trustees are looking at ways in which SEC can resolve the ongoing uncertainty related to United States commitment to global accounting standards.

In his statement Prada further acknowledged the challenges that transition to IFRS may bring forth before US constituents. However, he also mentioned that these challenges have been successfully overcome by jurisdictions at the time of completing their very own IFRS transition.

The staff report issued by SEC has pointed out a number of issues regarding activities and governance of the IASB. The SEC stated that there are quite a few areas where the IFRS requires more development. For example, accounting for insurance, rate regulated industries and extractive industries. SEC also noted that the IFRS Interpretations Committee can do a little more to resolve issues on time, the IASB should rely more on national standard setters, IFRS’s global application can be enhanced to narrow diversity and in order acquire funds IASB should continue to rely on the large public accounting organizations.

The staff report prepared by SEC has acknowledged that the IFRS Foundation has undertaken recent reforms in several areas very recently.

Issuing the statement given by the IFRS Trustee's, Prada noted that the trustees would study the report carefully and will look at details to take additional steps as and when necessary. IFRS Trustee’s preliminary assessment is that most of the findings of the report are largely consistent with the various conclusions drawn by the Monitoring Board and the Strategy and Governance reviews completed by the Trustees’ in early 2012 and have been previously addressed in the work plan.

The statement also included Hans Hoogervorst, Chairman of the IASB remarks. Hoogervorst mentioned that the broad adoption of IFRS is evident globally and IASB is confident that it will achieve a single set of premium quality accounting standards globally.