As part of the response to the financial crisis, the G20 called on accounting standard setters to work urgently to achieve a single set of high-quality global accounting standards, with a particular focus on the accounting for financial instruments. EFRAG had recommended that the directions set by the IASB in the first phases of the development of IFRS 9 should form the basis for high-quality financial reporting requirements for financial instruments.

Recent developments show strong signs of the FASB’s willingness to work actively towards a converged standard for the accounting for financial instruments. In addition, the IASB still has to complete important parts of its project to revise the financial instruments standard (e.g. general hedging, impairment of financial assets and offsetting) and to start discussions on other parts of that project (e.g. portfolio hedging).

EFRAG observes that reaching agreement on a converged financial instruments standard appears again to be a realistic goal that IASB and FASB can achieve jointly. Therefore, EFRAG urges the two Boards to continue their joint efforts to develop a converged high-quality financial instruments standard and agree on a new joint timeline for the finalisation of such standard, consistent with the G20 requirements.

In expressing support for the convergence efforts of both Boards, EFRAG recommends both Boards consider carefully EFRAG’s recommendations made in its letter dated 28 September 2010 (comment letter on the FASB ASU on accounting for financial instruments). EFRAG also reiterates that high quality financial reporting should remain the primary driver in the standard setting process.

Press release