21st February 2010
Pressure on the SEC to adopt IFRS seems to be mounting last week with Jim Quigley, CEO Deloitte Touche Tomatsu coming out strongly in favour of adoption of the international reporting standards. Writing in a report “What should boards and audit committees be considering now” he says, “The benefits of global adoption of IFRS are significant for investors. Global adoption will create a common denominator from which regulators and supervisors can assess the operations of the entities and markets they oversee. It will permit investors to compare the financial position of companies across borders, potentially allowing investors to more efficiently allocate capital on a global basis. And for many global companies, global adoption will likely eliminate the need to keep multiple sets of books in order to comply with divergent accounting regimes and thus improve the quality of financial statements by reducing the risk of translation errors between different accounting standards.” FASB and the IASB confirmed their commitment to continuing convergence between US-GAAP and IFRS last November - the Deloitte report is a timely reminder that the issue burns strongly in the international accounting firms and is probably gaining momentum. The balance seems to be shifting in favour of a global accounting standard – and why not?