27 March 2006

FEE Position Paper on Financial Reporting

The FEE issued a new position paper on Financial Reporting: Convergence, Equivalence and Mutual Recognition. The paper argues that the US GAAP and IFRS can be considered as equivalent sets of standards. FEE therefore expects the EC and SEC to agree as soon as possible on mutual recognition. FEE also calls for enhanced coordination between regulators including CESR and SEC to agree on the new enforcement behaviours that IFRS principle-based standards entail in order to minimise regulatory differences that could create inconsistent application

Also, FEE urges IASB, FASB, SEC and the Commission to be transparent and to communicate on the recently published plans for short term and long term convergence and its impact on the priorities in the IASB work programme. FEE believes it of crucial importance that the work programme is well explained and that public consultation is considered and comments on the priorities welcomed.

In launching this paper, FEE President David Devlin stated the “time is right for the acceptance of IFRS as truly global financial reporting standards. The European accountancy profession welcomes the recent confirmation of the European Commission’s and the SEC’s commitment to global accounting convergence and to eliminating reconciliation requirements. It is of crucial importance that a specific level of convergence is not needed for mutual recognition of IFRS and US GAAP.”

Press release
Position paper

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