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Chair of the IFRS Foundation Trustees speaks on digitalisation

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19 Jun 2019

On 19 June 2019, Erkki Liikanen, Chair of the Trustees of the IFRS Foundation, gave a speech discussing whether digitalisation will deliver increased productivity to the global economy and how the IFRS Foundation is undertaking its own digital transformation.

In his more general remarks on the global economy, Mr Liikanen noted that the economic growth cycle is now maturing, with various factors that may impede its longevity. In fact, he noted, globalisation itself faces some challenges around the world.

Mr Liikanen then turned to the academic debate on whether digitalisation, the process of leveraging technology and digitisation to improve business performance can take up the slack in productivity. He described two schools of thought that have emerged and concluded that technology is an important enabler, but it needs to work itself through and the real benefits will only come once the procedures can be fully implemented.

Turning then to financial reporting, Mr Liikanen noted that investors seek diversification and investment opportunities. The digitisation of financial information can help them to achieve these goals if it facilitates cross-border transactions and supports transparent, accountable and efficient financial markets in a digital world.

At this point, Mr Liikanen pointed to the IFRS Taxonomy and and its increasing adoption around the world - most recently in Europe. He promised that the IFRS Foundation will continue to explore how technological developments affect the way financial information is consumed and what this means for the Foundation's Taxonomy strategy, as well as how technology-related innovations affect the standard-setting process.

Concluding, Mr Liikanen noted that the IFRS Foundation is about to embark on its own digital transformation. He pointed at a long-term plan for the IFRS Foundation to completely overhaul its technology systems that was signed off at the last meeting of the Trustees (the report from the meeting offers little detail but notes that plan will be discussed again at the next meeting of the Trustees, which will take place on 25-27 June 2019 in Munich).

Please click to access the full text of Mr Liikanen's speech on the IASB website.

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