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Remarks by IASB Chairman Hans Hoogervorst at the IFRS Conference: Latin America and the Caribbean

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27 Oct 2011

On 27 October 2011, IASB Chairman Hans Hoogervorst addressed the IFRS Conference: Latin America and the Caribbean, in Sao Paulo, Brazil.

In his speech, he discussed the prospects for global accounting standards, Latin American adoption of IFRS, and the agenda and priorities of the IASB.

In regards to the prospects for global accounting standards, Chairman Hoogervorst commented that global accounting standards are needed to protect investors in a global financial market. He said that while IFRSs is now required or permitted to be used in many countries, there are a few important jurisdictions that have not adopted IFRSs, such as the United States, Japan, India and China. However, he believes its not a matter of "if" these jurisdictions will move to IFRSs, but of "when" and "how" it will occur.

Next on Latin American adoption of IFRS, Hoogervorst commented that full adoption of IFRSs is the right step to take and noted Brazil as "a textbook example of how to adopt". By accepting IFRSs fully "Brazilian companies are able to raise capital on markets across Asia, Europe and the Americas—including the United States. . . . The risk premium associated with unfamiliar financial reporting requirements is eliminated, thus reducing the cost of capital and attracting greater inward investment."

In conclusion, Hoogervorst discussed the future agenda and the four immediate priorities of the IASB in the coming year. First, the remaining convergence projects with the FASB need to be completed. He mentions that there will be revised proposals for both leasing and revenue recognition in the months ahead with the goal of completing these projects in 2012. He also mentions that the boards are working on a joint approach to financial instruments and insurance contracts. Second, the chairman gave a brief remark on the development of the IASB's post-convergence agenda, specifically the agenda consultation process aimed to solicit feedback to the IASB. The third priority of the IASB is to get the remaining jurisdictions to adopt IFRSs. Lastly, he says the IASB will work with those impacted by the IASB's work and "ensure that they have a sense of ownership and respect for the product that we are developing for investors globally."

Click for the speech transcript (PDF 361k, link to IASB website).

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