This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice for more information on the cookies we use and how to delete or block them.
The full functionality of our site is not supported on your browser version, or you may have 'compatibility mode' selected. Please turn off compatibility mode, upgrade your browser to at least Internet Explorer 9, or try using another browser such as Google Chrome or Mozilla Firefox.

Chairman of the IFRS Foundation Trustees optimistic regarding convergence and adoption of IFRSs

  • Speech — dark green Image

Mar 11, 2014

In a speech delivered at the 8th Annual Forum of the Gulf Cooperation Council Accounting and Auditing Organization in Riyadh, Saudi Arabia, Michel Prada, chairman of the IFRS Foundation Trustees, outlined the progress toward IFRSs as global standards and the evolution of the IASB as a global standard setter.

Mr. Prada stressed his belief that global accounting standards are essential to the correct functioning and well-being of the broader global economy and noted that policymakers must hold firm in their commitment to a single set of high quality standards. He underlined that we no longer live in a time where the providers and the consumers of financial information reside within the same country and that investors today routinely seek investment and growth opportunities across the globe. As a consequence, he said, preparers and users of financial information, as well as providers of capital, would be just as likely to be located on different sides of the world as in the same jurisdiction which, according to Mr. Prada, makes "a compelling case for a single set of high quality global accounting standards."

Chairman Prada measured the progress toward IFRSs as global standards against the number of jurisdictions that have already adopted IFRSs (more than 100) and against progress in some key jurisdictions. Regarding the possible adoption of IFRSs in Japan, he stressed that a voluntary use IFRSs is already possible and that the Japanese Financial Services Authority had recently expanded the number of companies eligible to adopt IFRSs. Mr. Prada remarked that China has already introduced accounting standards that are very similar to IFRSs and he expressed the hope that India would soon follow a similar path. He praised the convergence plan of Saudi Arabia as being well underway, and was even optimistic about a possible adoption of IFRSs in the United States. He admitted though that "progress has been slower than many of us would have wished," but he also stated that "the factors that led to the U.S. considering adoption of IFRS have not gone away," which leads him to believe "that the U.S. will ultimately come on board with IFRS although it will most likely take longer than we had hoped."

Mr. Prada also noted that the progress toward IFRSs as global standards has led to the evolution of the IASB as a global standard setter. He cited recent developments that illustrate this point, such as the introduction of the Emerging Economies Group, the setting up of a working group on Sharia-compliant instruments and transactions, and the introduction of the Accounting Standards Advisory Forum (ASAF). He also pointed to the deepening of the cooperation with other international and regional organizations and cited the agreement with the International Organization of Securities Commissions (IOSCO) signed in September 2013 and the agreement with the International Valuation Standards Council (IVSC) signed last week.

Please click for the full text of Mr. Prada's speech on the IASB's Web site.

Related Topics

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.