The regulation establishes an Accounting Regulatory Committee to advise the Commission in this regard and sets a deadline of 31 December 2002 for decisions regarding existing IAS. Under the regulation, IAS can only be adopted if they
- (a) are not contrary to EU Directives,
- (b) are conducive to the European public good, and
- (c) meet the criteria of understandability, relevance, reliability, and comparability.
The regulation requires that the Commission consider the views of national accounting standard setters; securities, banking and insurance regulators; central banks including the ECB; the accounting profession; and users and preparers of accounts. The private sector accounting profession in Europe has created an organisation called the European Financial Reporting Advisory Council (EFRAG) to present coordinated views to the Accounting Regulatory Committee and the Commission. EFRAG has begun its task of reviewing the existing IAS with regard to their applicability in Europe. Click for EFRAG Press Release