Japan Finalises Regulation Amendments to Retain US GAAP Option
The Financial Services Authority of Japan (FSA) has announced the finalisation of the removal of time limit for the use of United States Generally Accepted Accounting Principles (US GAAP) by certain Japanese entities (see our earlier story).
As proposed, the finalised revised regulations revert back to the situation before a revision made in December 2009, which introduced a prohibition on the use of US GAAP with effect from fiscal years ending after 31 March 2016. Accordingly, under the revised regulations, in principle:
- United States Securities Exchange Commission (SEC) registrants are permitted to also use US GAAP for domestic Japanese filing purposes
- Non-registrant current US GAAP users (typically companies which started using US GAAP for Japanese domestic purposes before 1977) are permitted to continue using US GAAP for domestic Japanese filing purposes. This option remains in place for an unspecified period, but may not be permanent.