2003

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Roundtable on registration of foreign audit firms with PCAOB

17 Mar 2003

The US Public Company Accounting Oversight Board will convene a roundtable meeting on 31 March 2003 at which interested persons can present their views on the effect and operation of PCAOB registration and oversight of foreign public accounting firms.

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Another Congressional letter to FASB on stock options

15 Mar 2003

A bipartisan group of 15 US Senators – including a former accountant and the Senator who led the Congressional opposition to FASB's proposal to expense stock options in the early 1990s – have Written to FASB (PDF 808k) urging enhanced disclosures, coupled with shareholder approval of all stock option plans, rather than mandatory expensing.

They also said that the deliberation process currently underway is "basically flawed".

Investors need accurate, reliable and meaningful information to make informed investment decisions. Accounting rules should reflect accounting principles that are generally accepted within the accounting profession, especially those that promote the disclosure, transparency, comparability and reliability of financial statements.

We believe a mandatory expensing standard – such as that proposed by the International Accounting Standards Board and apparently which is under consideration by the FASB – may not meet these important tests.... A mandatory expensing standard will not give investors accurate or reliable information – instead, they will get exactly the opposite.

See also our earlier news story of 19 February 2003.
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Canadian and German boards support expensing stock options

15 Mar 2003

In their letters of comment on IASB ED 2, Share-Based Payment, both the Canadian and German accounting standards boards expressed support for expensing stock options and for measuring them at the fair value of the options granted. .

In their letters of comment on IASB ED 2, Share-Based Payment, both the Canadian and German accounting standards boards expressed support for expensing stock options and for measuring them at the fair value of the options granted.

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Deloitte Touche Tohmatsu comment letter on ED 2

14 Mar 2003

We have posted our , Share-Based Payment (PDF 230k).

Our comments expressed the following principal conclusions:

Deloitte Touche Tohmatsu Principal Conclusions on Share-Based Payments

  • Share-based payments should be measured and recognised at fair value. Share-based payments to employees represent an element of compensation. The most relevant measurement of that compensation is fair value.
  • Share-based payments should be expensed over the period that the related service is provided.
  • Share-based payments should be measured at grant date, being the date the parties are committed to the transaction.
  • No adjustment should be made to fair value for vesting conditions.
  • Expensing should stop if the employee leaves and consequently stops providing services.
  • Minimum value should be used for unlisted entities.
  • For transactions involving the exchange of goods directly for equity, a measurement date does not occur until the exchange actually occurs (not at an earlier agreement date).
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IFAC's 2003 Handbook is published

14 Mar 2003

IFAC has released the 2003 edition of its Handbook of International Auditing, Assurance, and Ethics Pronouncements, containing all pronouncements issued as of 31 December 2002. The Handbook includes International Standards on Auditing (ISAs), developed by the International Auditing and Assurance Standards Board (IAASB), and IFAC's Code of Ethics for Professional Accountants.

A print version (includes CD ROM) may be purchased from IFAC. Alternatively, the handbook, and all pronouncements contained in it (and future updates), may be accessed free of charge by going to the IFAC Store.
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FASB adds employee stock options to its agenda

13 Mar 2003

Noting that "a move to require an expense treatment would be consistent with the FASB's commitment to work toward convergence between US and international accounting standards", the US Financial Accounting Standards Board has added to its agenda a project on employee stock options.

Click for FASB News Release.
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Overgang til de internationale regnskabsstandarder

13 Mar 2003

Deloitte & Touche in Denmark has developed a 28-page publication on (PDF 848k, in Danish, A5 format).

The booklet is written mainly for top management – the members of the supervisory boards and the executive boards of entities listed on the Copenhagen Stock Exchange and other large Danish entities. Of course, other Danish readers can get a quick overview of the process of transition to IAS by reading it. The booklet highlights areas of focus that are likely to require most resources for Danish entities.
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Adoption of amended EU accounting directives expected this month

12 Mar 2003

We have posted a Progress Report on the EU's Financial Services Action Plan as of 25 February 2003.

Click to download the Progress Report (PDF 48k).

The report notes that 32 measures have been completed, including Regulation (EC)1606/2002 of the European Parliament and of the Council on the Application of International Accounting Standards, adopted on 19 July 2002. The report also notes that a revised Directive modernising the accounting provisions of the 4th and 7th Company Law Directives is "expected to be adopted in March 2003." (click for More Information).

For a comprehensive chronology of progress toward IFRS in the European Union, please Click Here.

 

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EFRAG comment letter on ED 2

12 Mar 2003

We have posted the comment letter of the European Financial Reporting Advisory Group to the IASB on ED 2, Share-Based Payment (PDF 122k).

Overall, EFRAG supports the recognition of an expense when goods or services received or acquired in a share-based payment transaction are consumed.
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European IFRS regulation will apply to three EEA non-EU countries

11 Mar 2003

The European Economic Area (EEA) was created effective 1994 by an agreement between the EU and three countries -- Iceland, Liechtenstein, and Norway.

The three countries participate in the EU Single Market, while not assuming the full responsibilities of membership of the EU. As such, they must comply with the Accounting Directives and Regulations. We have updated our Table of Use of IFRS to indicate that companies from those countries that are listed in European markets must adopt IFRS starting in 2005, along with EU member countries. There are approximately 60 listed Icelandic companies and 200 listed Norwegian companies.

 

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