28 September 2004

IAS: Revised Proposal for a Draft Commission Regulation

The Commission published a revised draft on the proposal for a regulation on IAS 39. Although the discussion on this standard is still ongoing, the Commission intends to adopt all remaining IAS including the new International Financial Reporting Standards (IFRS) on time for their application in 2005. The International Accounting Standards Board (IASB) has officially recognised that an improvement of this standard is urgently needed. As far as the EU is concerned, two issues need to be resolved as a matter of urgency:

On the full fair value option the Commission hopes that a solution will emerge no later than December 2004.

On the hedge accounting provisions the Commission hopes that a solution will be found no later than September 2005.

Both issues have been the subject of in-depth discussions at several meetings of the Accounting Regulatory Committee. The Commission has presented three options to the Accounting Regulatory Committee:

a partial endorsement of IAS-39;

the exclusion of banks from the scope of application; and

a deferral of the adoption of the standard.

The Commission considers that a limited carve out of certain provisions in the standard is the best way forward.

Revised draft
ARC Annotated version (Revised)
Explanatory Memorandum

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