SEC Chair states that high-quality, globally accepted accounting standards are a "U.S. Imperative"

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06 Jan 2017

In a public statement on global accounting released on 5 January 2017, Mary Jo White, Chair of the United States Securities and Exchange Commission (SEC) stressed that the strength of the U.S. capital markets depended on investors knowing that they could rely on the financial information that is available to them when they make investment decisions. And since U.S. investors also made many investment decisions using IFRS financial statements, ensuring that IFRS, as well as U.S. GAAP, were of the highest quality was one of the Commission's "highest priorities".

While Ms White acknowledged that there had been no formal action by the Commission since 2010 and that any further action would be in the responsibility of the new SEC Chair Clayton, she nevertheless described the last years as a success:

Although the FASB and IASB have completed their agreed-upon, priority convergence projects, this milestone must not mark the end of the intense collaboration that has occurred between the two Boards over the last few years. These efforts have greatly enhanced the quality of accounting standards in a number of important areas, including recently narrowing many differences in the accounting standards for revenue recognition, leases, credit losses on financial instruments, and recognition and measurement of financial assets and liabilities.

She also noted that this progress was very important and that it needed to continue as both Boards, as well as investors, would benefit greatly from their sustained engagement. She concluded:

The United States cannot afford to be myopic about this issue in light of the benefits of these efforts for all stakeholders. Strong support of both the FASB and the IASB by U.S. investors, companies, auditors, and others, including the Commission, is essential. Indeed, it should be self-evident that the pursuit of high-quality globally accepted accounting standards is part of the SEC’s continuing responsibility to encourage, facilitate and direct efforts to enhance the quality of all financial reporting that directly impacts the protection of investors and the strength of our markets.

Please click to access the full statement on the SEC website

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