European Union’s Views on Accounting Principles
In a recent conference that was jointly organized by the European Financial Reporting Advisory Group as well as the Trustees of the International Financial Reporting Standards Foundation, some of the most important speakers from Europe organized a discussion on the EU’s viewpoint with regard to the move in the direction of accounting principles/standards.
The speakers held a discussion regarding the recent state of IFRS adoption within Europe. At present, over two-third of the G20 nations have accepted International Financial Reporting Standards. The EU is planning to adopt all the International Financial Reporting Standards that have been released by the International Accounting Standards Board only if they can be accepted and meet the requirements of Europe’s constituents. In order to fulfill this aim, opinions from European Union must be consolidated as one single message as well as expressed earlier during the standard creation procedure.
Another matter that was discussed during the conference include revolved around the development of the finance reporting in the United States. The representatives of the European Union specifically expressed the extent to which they are disappointed and frustrated about the result of the Securities Exchange Commission staff related paper pertaining to adoption of International Financial Reporting Standards in the United States.
The absence of a decision in the Securities and Exchange Commission’s staff related paper was viewed in a negative manner and has resulted in a slowdown on global efforts pertaining to convergence.
The speakers who participated during the conference were Deputy Director General Nadia Calvino, European Financial Reporting Advisory Group Chairman Francoise Flores, Chairman of IASB Hans Hoogervorst, Sven Hayn of Ernst& Young and Peter Malmqvist among others.
During the conference the speakers also acknowledged that the procedure for setting technical related standard is also influenced by politics and could have wide implications with regard to politics. The economic and financial crisis has demonstrated the relevance of legitimate and robust independent global accounting principle setting procedure, which responds to the interest of the public. A number of speakers suggested that the enhancing of the finance reporting should be the only aim of the international principle/standard setting procedure.