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FASB and IASB Agree to converge GAAP and IFRS
Goal to develop converged standards -
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Wanted elimination of foreign companies to reconcile statements to GAAP
Thought EU would deem IFRS and GAAP equal
Agreed with EU Internal Markets Commissioner -
FASB and IASB recognize the need for a roadmap
Lay out goals of short-term convergence to have achieved by 2008 -
SEC proposes elimination of foreign issuers to file in accordance with GAAP
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Commission publishes to allow U.S. issuers the option of reporting according to IFRS
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FAF and FASB respond to the SEC’s Concept Release
Support convergence
Argue that dual reporting would result to be more complicated -
SEC moves forward and decides to adopt the rule. Foreign private issuers are now allowed to file their financial statements prepared in accordance with IFRS, no longer needing to accommodate for the generally accepted accounting principles.
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IASB and FASB update the MoU
Report progress and goals through 2011 -
Resisted pressure from EU to adopt IFRS outright
Held that a conversion would be better -
Further emphasizes support for a single set of set of high-quality globally accepted accounting standards
Plan for SEC staff to develop a work plan -
Reported on the completions of five projects that have been converged
Decided priority be given to financial instruments and leases -
Combination of convergence and endorsement
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Made a statement in a presentation
Vast growing capital markets
http://www.sec.gov/news/speech/2011/spch062411klc.htm -
Walter is the current acting chairperson of the SEC
"We will get there eventually"
No exact timetable -
Obama declared "You don't want to mess with Mary Jo"
Potential reasons to slow down the process
