Agreement Reached Over EU Funding of IFRS, EFRAG and PIOB
A trilogue agreement has been reached by all of the three parties involved on the subject of the EU co-financing the IFRS, International Financial Reporting Standards Foundation, EFRAG, the European Financial Reporting Advisory Group and PIOB, the Public Interest Oversight Board. The three parties concerned in the agreement are the European Parliament, the Commission and the Council.
This new agreement comes in the wake of a recent vote by ECON, the Committee on Economic and Monetary Affairs. This vote of the European parliament was on the report regarding the proposal for by the European Parliament and the Council on the establishment of a united program which would support specific activities within the fields of financial auditing and reporting for the period 2014-2020.
ECON have proposed that this program should be used in such a way that is ensures all monies contributed is spent responding to the needs of the European Union. In particular, ECON have recommended the move from giving 6 years worth of funding in a lump sum to a yearly assessment to ensure that certain criteria is being fulfilled.
The proposed regulation which has been agreed upon will effectively form the legal basis for the continuing financing of PIOB and the IFRS Foundation from 2014 to 2020 and for EFRAG from 2014 to 2016. The agreement effectively limits future financial periods for EFRAG to 3 years in line with the prospective reforms that could arise from the recent Maystadt Report.
The regulation, in financial terms, is proposing to make approximate annual contributions as follows;
€4.3m to IFRS Foundation (17% of its total budget)
€3.4m to EFRAG (43% of its total budget)
€0.3m to PIOB (22% of its total budget)
The next step in the process will be a first/single reading in Parliament which is expected to take place on January 13 2014.