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.

Journal entry — FASB and IASB issue joint statement on convergence; SEC chairman comments

Published on: Jun 03, 2010

Yesterday, the FASB and IASB issued a joint statement announcing their intention to modify their strategy to improve and converge IFRSs and U.S. GAAP. That strategy was initially documented in the 2006 Memorandum of Understanding (MoU), which was updated in 2008 and reaffirmed in November 2009. Details on how the boards’ strategy will be modified were not revealed, but the announcement did state that the purpose of developing a modified strategy was to “prioritise the major projects in the MoU to permit a sharper focus on issues and projects that [they] believe will bring about significant improvement and convergence between IFRS and US GAAP.” This joint statement may affect the timing of some of the projects included in our May 2010 Accounting Roundup — Special Edition, which contains details on and insights into the MoU projects.

The boards indicated that their constituents had voiced concerns about their ability to “provide high-quality input on the large number of major exposure drafts planned for publication in the second quarter” of 2010. To address these concerns, the boards announced that they would stagger the issuance of significant exposure drafts (limited to four per quarter) and the timing of roundtables (to discuss comments with constituents). In addition, the boards will issue a separate document to obtain input from constituents regarding effective dates and transition methods. While the modified plan will largely retain the June 2011 targeted completion date, a few projects will be extended into the second half of 2011. The boards expect to release a new work plan identifying projects and their revised target dates shortly.

In response to the boards’ joint statement, SEC Chairman Mary L. Schapiro also issued a statement on June 2, 2010, acknowledging that the modified plan should increase the quality of the standards and the feedback received from constituents. Schapiro expressed confidence that the project timing changes planned by the FASB and IASB will not negatively affect the Commission's work plan. She stated, “I am confident that we continue to be on schedule for a Commission determination in 2011 about whether to incorporate IFRS into the financial reporting system for U.S. issuers.” See Deloitte’s February 26, 2010, Heads Up for details on and insights into the SEC announcement.

Accounting Journal Entries Image

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.