On accounting standards, the G20 “re-emphasized the importance we place on achieving a single set of high quality improved global accounting standards.”
The current convergence developments suggest a bit of a holding pattern, giving some space
to the IASB and the FASB to continue their work.
Convergence efforts cannot be an endless exercise
It also “urged the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) to increase their efforts to complete their convergence project by the end of 2011.” Previously it had said by June 2011.
Thus, the G20 seems to have tacitly acknowledged the IASB-FASB announcement shortly before the summit that they would prioritize their work program and delay the completion of some of the convergence projects. At the same time, however, the G20 made it clear that convergence cannot be endless.
G20 calls for “improved” standards
Note also that the G20 has now called for “improved” standards.
The insertion of this word is new — perhaps it is intended to acknowledge that convergence for convergence sake is not desirable, and that the process must result in higher quality standards. In referencing the convergence efforts, the Financial Stability Board (FSB) progress report expressed concern over FASB’s recent Exposure Draft on Accounting for Financial Instruments.
Finally, the G20 encouraged the IASB to “further improve the involvement of stakeholders, including outreach to emerging market economies, within the framework of the independent accounting standard setting process.”
These statements can perhaps be viewed as a bit of a holding pattern, giving some space to the IASB and the FASB to continue their work.
Overall, it is clear that accounting standards are still very much on the minds of the G20 leaders and it is likely that more may be said at the next summit in Seoul, Korea in November.
