25 June 2008

FASB - Improving US GAAP still FASB focus

Members of the Financial Accounting Standards Board are already thinking about how the transition from US GAAP in favour of the IFRS will affect their standards setting activity although no date has been set for U.S. companies.

Members of the Financial Accounting Standards Board are already thinking about how the transition from US GAAP in favour of the IFRS will affect their standards setting activity although no date has been set for U.S. companies.

 

For the time being, the FASB remains committed to its longstanding role of issuing and modifying guidance under U.S. GAAP.

 

“It's necessary and important to maintain U.S. GAAP, which requires making improvements and fixing problems as they arrive,” said George Batavick, a FASB member, during the Board's Mid-Year Update on Monday. “This is something we cannot ignore - maintaining existing GAAP is quite important.”

 

Batavick also said he favoured a two-year moratorium on issuing new accounting standards, one year before and one year after the initial adoption of IFRS in the U.S. During this period, companies would prepare statements in both U.S. GAAP and IFRS, and the time would give companies an opportunity to establish new financial reporting systems with minimal disruption while they adopt the international rules.

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