Business Accounting Council of Japan looks for ways to Promote the use of IFRS in Japan
A meeting was held on May 28, 2013 among the members of Japan’s Business Accounting Council to discuss the use of IFRS in Japan. No decision was made however Business Accounting Council took another step to conclude the debate.
In the April 2013 meeting, BAC focused on three initiatives to promote the use of IFRS in Japan. The first initiative was to ease the eligibility to use IFRS. It means criteria to use IFRS voluntarily was made easy for companies. The officials of Financial Services Agency suggested that the companies that do not own a foreign subsidiary with twenty billion yen or more of the stated capital and companies newly going to public should be permitted to use IFRS. Question answers were done on this inactive however no conclusion was drawn.
The second proposal was to introduce the 4th accounting standard framework in addition of Japanese GAAP, US GAAP and IFRS. Members of VAC, as happened in the previous meeting, did not show any supportiveness to introduce 4th accounting framework. Also, they had various concerns about introducing the 4th framework of accounting standards.
The third initiative was to streamline local disclosure requirements of separate financial statements in accordance with Japan’s Generally Accepted Accounting Principles. In this initiative, the official of FSA suggested to replace certain disclosures required under Financial Instruments and Exchange act with ones that are similar in Companies act. Again, similar to the precious two BAC meetings, members were completely divided and meeting reached to an end without nay conclusive decision. At the end, the BAC chairman noted that in the next meeting BAC will conclude these rounds of debates on the basis of a summery paper which FSA will provide.