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IFRS Foundation published staff paper in connection with the consultation on the impact of IFRSs in the EU

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05 Sep 2014

In August 2014, the European Commission (EC) launched a public consultation on the impact of International Financial Reporting Standards (IFRSs) in the EU. The IFRS Foundation has now published a staff paper that provides a perspective from the staff on some of the main issues highlighted in the consultation questionnaire.

The staff paper is not a response to the consultation but is intended to contribute to the debate about the extent to which the adoption of IFRS has improved the efficiency of EU capital markets.

The issues covered in the staff paper include:

  • The benefits of IFRS — The paper stresses the increased market efficiency, the better basis for investment decisions, the improved quality of financial information, the higher attraction of foreign investment, the better capital market integration, and the consistent method of application supported by a common infrastructure at a national and international level.
  • Endorsement mechanism and criteria — The paper points at the support for the maintenance of the standard-by-standard adoption procedure shown in the Maystadt report, comments on modifications made to IFRSs in Europe and other jurisdictions, and warns against the consequences of possible non-endorsement.
  • Quality of IFRS financial statements — The paper notes that the Maystadt report found that IFRS has improved the quality, comparability and reliability of financial information in the EU and that the European Securities and Markets Authority (ESMA) publishes annual reports on enforcement activities in Europe that show continued improvements in the quality of IFRS financial statements over the years.
  • Enforcement — The paper points out that the IFRS Foundation's vested interests include helping to ensure the consistent application of IFRS internationally. To this end, the Foundation has worked to deepen its cooperation with securities regulators including the International Organisation of Securities Commissions (IOSCO) and ESMA.

For more information, see the staff paper on the IFRS Foundation website.

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