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SEC official comments on IFRSs in United States

  • SEC (old) Image

29 Jan 2008

In two recent speeches, John W White, Director of the Division of Corporation Finance of the US Securities and Exchange Commission, discussed issues relating to the use of IFRSs in the United States and some of the SEC's international initiatives.

Here are the two speeches, and below are two excerpts relating to IFRSs:

International Financial Reporting Standards: Where do I begin on this topic? Tremendous strides have been made in this area over the past year.

  • In March, we conducted a staff roundtable on IFRS.
  • In April, the Commission issued a next steps press release.
  • In July, a proposing release was issued relating to elimination of reconciliation to US GAAP by foreign private issuers using IFRS.
  • In August, a concept release was issued relating to the possible use of IFRS by US issuers.
  • In November, the Commission voted to approve elimination of reconciliation to US generally accepted accounting principles (US GAAP) by certain foreign private issuers using IFRS.
  • In December, the Commission held two roundtables relating to use of IFRS by US issuers.
Quite a year! While I can only speak for myself, I am comfortable telling you that the staff at the SEC – particularly in the Division of Corporation Finance – is deeply committed to the goal of achieving a single set of high quality, globally accepted accounting standards and we truly are interested in hearing from all stakeholders as we continue to progress down this road.

 

How to proceed from the concept release on possible use of IFRSs by US issuers: One of the more debated topics [at the December roundtables] was how to proceed from the concept release. Participants expressed a wide range of views and a number of overlapping options emerged:

  • Have the Commission lay out a so-called 'road map' of steps forward.
  • Allow the voluntary use of IFRS for an indeterminate period. Under this option, we would allow some or all US issuers to use either IFRS or US GAAP for an indefinite period of time.
  • Set a fixed date in the future for the mandatory use of IFRS. Under this option, we would select a date in the future and require that all issuers switch to using IFRS at that time. This was the approach followed in Europe.
  • A 'wait and see' approach on further rulemaking by the SEC, allowing convergence, investor understanding and the infrastructure for IFRS to further develop over the next few years.
  • Various combinations of the above.

 

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