The paper analyses the feedback received in response to the Foundation’s public consultation paper "Status of Trustees’ Strategy Review", which was issued on 5 November 2010. The paper contains comments on the Trustees’ questions and recommendations for improvements.
Nearly 80% of respondents broadly supported the Foundation’s current mission statement, which focuses on decision-relevant information for investors and other users of financial information.
It was the predominant view of respondents that, although high quality accounting standards contribute to financial stability, the main objective of developing accounting standards is not to promote financial stability. Close to 75% of respondents stated that the primary objective of developing accounting standards is provision of transparent and comparable financial information to the identified key users.
In commenting on the broader question of governance, respondents generally supported a structure that promotes the independence of the accounting standard setting function. In addition, many viewed independence and accountability as complementary concepts, and felt that there was no need to balance or offset them. Accountability is seen as being essential to the preservation of independence, and is the mechanism which gives stakeholders confidence that the roles are being fulfilled. Around 70% of respondents agreed that the current structure should be retained, but that within that structure more clarity of roles and responsibilities is required, particularly with regard to the Trustees and Monitoring Board.
The majority of respondents did not consider that formal political endorsement or relocating the Trustee body to the public sector was necessary. This is because the legitimacy of the Foundation and its activities is determined by whether its governance arrangements reflect the principles of transparency, accountability and democratic processes. Respondents appreciated that some form of public accountability on the part of the Foundation was required, but that this could be achieved by other means such as increased transparency, consultation and representation in its governance arrangements. It was also felt that endorsement by other bodies may complicate the standard setting process.
Many respondents noted that IFRSs are developed through a comprehensive due process but that further improvements should be enacted. They welcomed a number of recent initiatives, such as periodic consultation on the work programme, enhanced outreach efforts, and use of feedback statements.
Many respondents (around 70%) held the opinion that consistent implementation and application of IFRSs were increasingly crucial issues, especially with new standards coming online and with countries increasingly adopting IFRS. However 37% of respondents acknowledged that the IASB could not unilaterally enforce how IFRSs are used because it has neither the mandate nor the resources to do so. National securities regulators, standard setters, professional organisations and accounting firms also have key roles in the implementation of IFRS in their jurisdictions.
More than 75% of respondents agreed that a stable, diversified and automatic funding model was required to provide sufficient funding for the organisation to carry out its objectives while maintaining its independence. The funding principles developed by the Trustees to guide funding efforts (i.e. broad-based, compelling, open-ended and country-specific) were broadly supported.
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