-The Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) have issued a memorandum of understanding, marking a significant step toward formalizing their commitment to the convergence of U.S. and international accounting standards.
The announcement is a major step towards a global system of accounting standards and will in particular help the US Securities and Exchange Commission (SEC) to accept financial statements prepared by EU companies in accordance with IAS, without reconciliation to US GAAP, for the purposes of listing on US markets.
Frits Bolkestein said that 'today's announcement is a very positive move towards a single worldwide set of high-quality, best of breed, principles-based financial reporting standards, which would dramatically improve the efficiency of global capital markets: costs would decrease, comparability would improve and corporate governance would be enhanced.”
The agreement follows the decisions recently reached by both Boards to add a joint short-term convergence project to their active agendas. The FASB and IASB expect to issue an Exposure Draft to address some, and perhaps all, of those identified differences by the latter part of 2003.
Joint FASB/ IASB press release
Commission press release
SEC press release
© IASB - International Accounting Standards Board
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