News

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ICAEW letter to Commissioner Bolkestein re IAS 39

15 Aug 2004

The Institute of Chartered Accountants in England and Wales has written to EC Internal Market Commissioner Frits Bolkestein urging the European Commission to adopt IAS 39 in its entirety as part of the full suite of International Financial Reporting Standards for use in Europe.

An excerpt from the letter is below. Click for full text of (PDF 354k).

We understand that the Commission is considering deleting certain sections of lAS 39 and proposing the amended standard for endorsement. We are greatly concerned by this development. Introducing differences between IFRS in Europe and IFRS, as set by the International Accounting Standards Board (IASB), is likely to lead to long-term damage to the credibility and quality of financial reporting in Europe. We note that the idea of European financial reporting standards is rejected in the IAS Regulation (No. 1606/2002) itself: Recital 2 states that '... it is important that the financial reporting standards applied by Community companies participating in financial markets are accepted internationally and are truly global standards.'

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IAS Plus newsletters for 3Q 2004 are published

14 Aug 2004

We have posted the July 2004 edition of our quarterly -->IAS Plus --> newsletter in two versions: (PDF 22 pages 316k) (PDF 31 pages 432k) Both editions have the same news about international financial reporting, including updates on IASB projects and Board activities and news about IFRS in Europe, the United States, and elsewhere in the world.

Additionally, the Asia-Pacific edition has updates on accounting standard setting activity in a number of countries in that region. You will find all past issues Here.
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Argentina moves toward International Standards on Auditing

13 Aug 2004

The Board of the Argentina Federation of Professional Councils of Economic Sciences (Federacion Argentina de Consejos Profesionales de Ciencias Economicas - FACPCE) has agreed to consider adopting International Standards on Auditing issued by IFAC's International Auditing and Assurance Standards Board (IAASB) as Argentine auditing standards for periods beginning 1 July 2005. "FACPCE reserves the right to adopt the ISAs in total, or partially, with or without differences." Click for FACPCE Website. .

The Board of the Argentina Federation of Professional Councils of Economic Sciences (Federacion Argentina de Consejos Profesionales de Ciencias Economicas - FACPCE) has agreed to consider adopting International Standards on Auditing issued by IFAC's International Auditing and Assurance Standards Board (IAASB) as Argentine auditing standards for periods beginning 1 July 2005. "FACPCE reserves the right to adopt the ISAs in total, or partially, with or without differences." Click for FACPCE Website.

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McCreevy will be new EC Commissioner for Internal Market

13 Aug 2004

José Manuel Barroso, President-designate of the European Commission (top photo), has announced the policy portfolios he has allocated to each of the 25 new EC Commissioners.

Charlie McCreevy (bottom photo), who is an Irish Chartered Accountant, will be Commissioner for Internal Market and Services, replacing Frits Bolkestein. Among Mr. McCreevy's responsibilities will be accounting and financial reporting, including the implementation of IFRSs in Europe. The new Commission will take office on 1 November, subject to approval by the European Parliament. The Parliament can vote only on the whole body and not on individual Commissioners. The EC decision on endorsing IAS 39 is expected to be made by the current Commissioners before 1 November. Click for:

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Model IFRS financial statements for 2005

11 Aug 2004

We have posted Deloitte's for the year ended 31 December 2005 (PDF 609k).

These model financial statements were developed to illustrate the typical disclosures that will be required of a United Kingdom listed company with subsidiaries and associates, reporting under IFRSs for both the company and consolidated financial statements, for 2005. Material that is included to meet specific UK requirements and specific references to UK GAAP have been highlighted on a yellow background. Otherwise, these model financial statements would be appropriate for entities following IFRSs in any country. The model financial statements are based on standards issued at 31 May 2004 that are expected to be effective for years beginning on or after 1 January 2005. They also reflect the proposed amendments to IAS 19 issued by the IASB in April 2004 on the assumption that they will be approved and become effective in 2005. Model IFRS financial statements and a disclosure checklist for 2003 are available Here.
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SEC Chief Accountant speaks about IASB-FASB convergence

11 Aug 2004

In a presentation at the annual meeting of the American Accounting Association, SEC Chief Accountant Donald T.

Nicolaisen addressed a range of issues, including FASB and IASB cooperation:

The FASB and IASB support moving toward a single conceptual framework that would be used by both Boards. The work of these two Boards, and other national standards setters involved in the IASB process, is an important part of building and maintaining an effective global financial reporting infrastructure. I support global convergence. It's in the best interest of investors.

In response to a question, Mr. Nicolaisen said that the Commission will undertake a study of the IFRS reconciliations to US GAAP that are submitted for 2005 and, based on the findings, will determine whether to eliminate the reconciliation. He indicated his hope that the reconciliation could be eliminated by the end of the current decade. Click for Full Text of Mr. Nicolaisen's Remarks (link to SEC website).
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Comprehensive summary of Business Combinations Phase II

10 Aug 2004

The IASB and the US FASB are developing common exposure drafts of their proposed standards on accounting for business combinations.

Those exposure drafts will incorporate (1) the decisions reached in the Boards' current joint purchase method procedures project (Phase II) and (2) the decisions previously reached in the Boards' separate Phase I projects, which led to the issuance of FASB Statement No. 141 Business Combinations, and IASB IFRS 3 Business Combinations. The common EDs will be similar in both wording and style (including the IASB style of highlighting principles in bold type). The expected issuance date of the EDs is now the fourth quarter of 2004. The FASB has just posted on its website a 156-page staff summary of tentative decisions reached in Phase II of the project. Because there is no comparable summary on the IASB's website and the Boards are working toward issuing nearly identical standards, the FASB summary should be of interest to those who are following the IASB project as well. Click to Download the FASB Summary (PDF 1,191k).
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International issues noted in US PCAOB annual report

09 Aug 2004

The US Public Company Accounting Oversight Board (PCAOB) has published its annual report for 2003 – its first full year of operations.

In the international area, the report notes, among other things, that the PCAOB has "hired an international affairs staff to advise the Board on international issues and facilitate dialogue with foreign regulators regarding oversight of registered non-US accounting firms." Click to the report (PDF 1,012k).
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FEE urges stronger EU auditor education requirements

08 Aug 2004

The European Federation of Accountants (FEE) has urged the European Union to strengthen its requirements for education of statutory auditors currently in Articles 6 through 10 of EC 8th Directive.

In the area of financial accounting and reporting, FEE would require, among other things, education in "international standards and national laws, regulations and standards appropriate to the preparation of company and consolidated financial statements and to methods of valuing balance sheet items, of computing profits and losses, reporting cash flows and changes in equity". Click for (PDF 173k).
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New Deloitte guide to applying IFRS 3 Business Combinations

08 Aug 2004

Deloitte is pleased to make available, without charge, our new 84-page Guide to IFRS 3 Business Combinations.

The guide:
  • Outlines the key features of IFRS 3.
  • Provides illustrative examples to assist readers in applying the standard.
  • Discusses the requirements of IAS 36 Impairment of Assets and IAS 38 Intangible Assets as they relate to business combinations.
  • Includes:
    • Guidance on determining fair value for the purposes of accounting for business combinations;
    • An overview comparison between the requirements of IFRS and those of US GAAP;
    • A number of frequently asked questions; and
    • Illustrative disclosures.
Click to (PDF 1,894k*). *Because of the large file size, a white screen may appear for a while when downloading.

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