The European Federation of Accountants (FEE) is pleased to submit its comments on the IASCF consultation paper on the Review of the Constitution of November 2004.
FEE recognises that IASB’s status as a privately established body remains crucial for its independence and technical integrity as a standard setter. However, it is important to address the accountability of private international organisations such as the IASB and IASCF in order to meet requirements and expectations in various jurisdictions around the world. An enhanced consultation process and compliance with appropriate due process are essential cornerstones given the public interest role the IASB has to play.
That international accounting standards become part of legislation through an endorsement mechanism expressly adds a political dimension to the process. This requires that higher importance is given to accountability of the IASB notably focusing on appropriate democratic oversight and improved transparency.
FEE recommends that the Constitution should require convergence agreements with key countries to be reviewed after a certain period of time including a study of implications for the quality of standards and the actual convergence achieved. The convergence debate with the FASB should be operated through a balanced mechanism whereby further consideration needs to be given to a form of European involvement in order to make the terms of the debate more visible and acceptable to European interests.
The IASB work programme, its own priorities and convergence priorities should be extensively debated at regular intervals and involve all major parties. The SAC and Trustees should be prepared to enter into a public debate as to which are the most important priorities. Europe, as the most significant user of IAS/ IFRS worldwide, should be involved in all parts of the debate and in the convergence debate.
Representative organisation for the accountancy profession in Europe
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