As global leaders prepare to descend upon Pittsburgh during the September 24 – 25 G-20 Summit, the International Federation of Accountants (IFAC) is expecting global accounting standards to be on the agenda.
IFAC has urged G-20 leaders to utilize the summit platform as an opportunity to speak to the importance of worldwide adoption of global accounting standards and include that concept in the promotion of global economic recovery. In a July 31, 2009 letter issued to G-20, IFAC called “for the adoption and implementation of International Public Sector Accounting Standards as a means to greatly improve government transparency and accountability in the light of the unprecedented takeovers, lending, guarantees, and bailouts of major market institutions, banks and companies.” IFAC also recommended that further steps be taken to enhance the governance of the International Accounting Standards Board (IASB), to assist in its ability to act independently in a standard-setting role without inappropriate political interference.
IASB Chairman Sir David Tweedie added fuel to the potential discussions with his recent comments on the global frustrations with the SEC’s lack of commitment to a transition to International Financial Reporting Standards (IFRS), which have not yet been approved by SEC Commissioner Mary Schapiro. “This is a very interesting moment for us, a once-in-a-lifetime moment. Where is the USA?” asked Tweedie. “If you’re going to have global standards, we need the U.S., but it can’t go on indefinitely. We’ve been converging for seven years. We have a timetable to finish in 2011. It’s designed to fit these major economies – Korea, Canada, Japan, and India – who are converging that year. We have to finish that year.”
With 117 countries already adopting IFRS and Chairman Tweedie’s expectation that the number will reach 150 by 2011, the Obama administration may face substantial pressure at the G20 Summit for the U.S. to commit to the transition to IFRS.
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