The IFRS Foundation has posted a joint letter received from the national standard-setters of Germany (DRSC e.V.), France (Autorité des normes comptables), the UK (FRC) and Italy (Organismo Italiano di Contabilitá), commenting on the proposed creation of an Accounting Standards Advisory Forum.
Currently no stable and formalised working relationship exists between the IASB and national accounting standard-setters, except in the case of certain countries who do not adopt IFRS. This is why the national standard-setters of Germany, France, the United Kingdom and Italy undertook to update the "Statement of Best practice", which IFASS, including the IASB, has considered on several occasions in the last 18 months.
The national standard-setters consider however, that the latest proposals issued by the Foundation fall short of their needs and expectations for the following reasons:
-
The proposals fail to take fully into consideration the benefits that could arise from closer cooperation, given the similarity of tasks performed by the IASB and national standard-setters, acting on the basis of public interest mandates and synthesising the views in their jurisdictions. Formalisation of cooperation with accounting standard- setters is presented as a risk for the IASB; although the proposals identify that the Accounting Standards Advisory Forum (ASAF) would provide advice and views to the IASB and as a wider body of national standard-setters may support its standards these elements are not identified as opportunities;
-
No fundamental objective is identified in the proposals for the ASAF, making it difficult to understand:
-
(i) how it is going to enhance the standard setting process;
-
(ii) what the size and composition of the ASAF should be; and
-
(iii) whether IFRS adopters will be given due prominence.
-
The proposals, by focusing on risks to the IASB and outlining principles and obligations that a member must commit to, do not suggest a spirit of partnership in the relationship between the IASB and national standard-setters, which they feel should be at the core of their common working relationship;
-
The proposals only address one aspect of cooperation, leaving aside many other dimensions, such as the effective and efficient interaction between stakeholders, national standard-setters and the IASB and how best to rationalise these at all stages of the standard-setting process, including at strategic level; we believe that this is a key element which, if addressed, would have led to put the current proposal in perspective and to change its main parameters;
-
It is not clear how the role of the ASAF will alter (or not) other advisory groups, such as the Standards Advisory Council; and
-
They do not think it is clear from the proposals how members of ASAF will be appointed.
In relation to the selection of candidates, priority is not given to countries applying IFRS. If the objective of the ASAF is to share technical issues, foster strategic discussions and facilitate the smooth adoption of IFRS being issued, then preference should be given to standard-setters from IFRS adopter countries In addition, to only suggest two seats for the EU is out of proportion with its current policy on the adoption of IFRS.
Full comment letter
© IASB - International Accounting Standards Board
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article