NEWS RELEASE 09/11/08
IASB and FASB Publish Update to 2006 Memorandum of Understanding
2008 update establishes goal of completing joint projects on major topics by 2011
The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) today published an update of their 2006 Memorandum of Understanding (MoU). The Boards are issuing this update to report the progress they have made since 2006 and to set the goal of completing their major joint projects by 2011.
In giving a report of the progress of projects laid out in the MoU, the Boards have again affirmed their commitment to developing a common set of high-quality standards. Each believes that such standards would improve the quality, consistency, and comparability of financial information for investors and capital markets around the world. The MoU is available at www.fasb.org.
Commenting on the update, Sir David Tweedie, chairman of the IASB, said:
This update outlines a plan and projected time line for completing the remaining joint major projects included in the MoU. A number of jurisdictions including Canada, India, Japan, and Korea have announced plans to adopt or converge with International Financial Reporting Standards (IFRS) from 2011. Completing the MoU beforehand will avoid the need for those jurisdictions to make major changes shortly afterwards as MoU projects are completed.
Whilst the MoU forms an essential part of our strategy, we remain committed to addressing other important projects on our agenda, such as insurance accounting, and those standards affected by the credit crisis.
Robert Herz, chairman of the FASB, said,
In updating the 2006 MoU, the FASB and the IASB have set a goal of completing a number of major projects over the next few years. I believe that delivering on that goal will bring significant improvement to both U.S. GAAP and IFRSs in areas that are important to investors. We also will decide by the end of the year whether to modify the short term convergence program to enable a sharpened focus on the major improvement efforts. This reflects our continued commitment to work together to develop a single set of high-quality international accounting standards.
We will continue our dual objectives of working toward global convergence while addressing reporting issues of critical importance to U.S. investors and financial markets.
The Boards are aware that continued progress toward convergence is a factor that the Securities and Exchange Commission will consider in evaluating its recent proposal to permit or require use of IFRSs in the U.S.
The IASB and the FASB will hold their next joint meeting on October 20 and 21 in Norwalk, Connecticut.
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Press inquiries:
Mark Byatt, Director of Corporate Communications, IASB,
telephone: +44 (0)20 7246 6472, email: mbyatt@iasb.org
30 Cannon St, London EC4M 6XH, UK
Sonja Horn, Communications Adviser, IASB,
telephone: +44 (0)20 7246 6463, email: shorn@iasb.org
30 Cannon St, London EC4M 6XH, UK
Neal McGarity, Director of Communications, FASB
telephone: +1 203 956 5347 (US) email: nemcgarity@f-a-f.org
401 Merritt 7, PO Box 5116, Norwalk, Connecticut, 06856-5116, USA
About the IASB
The IASB was established in 2001 and is the standard-setting body of the International Accounting Standards Committee (IASC) Foundation, an independent private sector, not-for profit organisation. The IASB is committed to developing, in the public interest, a single set of high quality, global accounting standards that provide high quality transparent and comparable information in general purpose financial statements. In pursuit of this objective the IASB conducts extensive public consultations and seeks the co-operation of international and national bodies around the world. Its 14 members (12 of whom are full-time) are drawn from nine countries and have a variety of professional backgrounds. They are appointed by and accountable to the Trustees of the IASC Foundation, who are required to select the best available combination of technical expertise and diversity of international business and market experience.
About the FASB
Since 1973, the Financial Accounting Standards Board has been the designated organization in the private sector for establishing standards of financial accounting and reporting. Those standards govern the preparation of financial reports and are officially recognized as authoritative by the Securities and Exchange Commission and the American Institute of Certified Public Accountants. Such standards are essential to the efficient functioning of the economy because investors, creditors, auditors, and others rely on credible, transparent, and comparable financial information. For more information about the FASB, visit our website at www.fasb.org.
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