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IASB takes steps to assist adoption of IFRSs and reinforce consultation: no new standards until 2009

01 July 2006

The International Accounting Standards Board (IASB) today announced measures aimed at assisting companies and countries to adopt International Financial Reporting Standards (IFRSs) consistently and rigorously, while encouraging broad input into the IASB’s continuing work programme. The measures are:

  • Stability of standards until 2009: The IASB will not require the application of new IFRSs under development or major amendments to existing IFRSs before 1 January 2009.

Delaying implementation of new standards until 2009 provides four years of stability in the IFRS platform of standards for those companies that adopted IFRSs in 2005. Companies will, however, be permitted to adopt a new standard on a voluntary basis before its effective date. Interpretations and minor amendments to correct problems identified in practice are not subject to this 2009 delay.

The establishment of 2009 as the first date of implementation of new standards will provide countries yet to adopt IFRSs with a clear target date for adoption. By 2009, the joint efforts of the US Financial Accounting Standards Board (FASB) and the IASB should also permit the removal of the need for the reconciliation requirement for non-US companies that use IFRSs and are registered in the United States.

  • Increased lead time to prepare for new standards: The IASB will allow at least one year between the date of the publication of a major standard or any major change to a standard and the date when implementation is required. This policy will provide time for translations and implementation of new standards into practice and law, where IFRSs are legally binding.
  • Increased opportunity for input on conceptual issues: The IASB, along with the FASB, has agreed to publish discussion papers, rather than moving directly to exposure drafts, on all topics that are part of their Conceptual Framework project.

The IASB has also announced that it will publish a discussion paper as the next step of its Fair Value Measurement project, which is aimed at providing consistency in the application of existing fair value requirements. The decision to use discussion papers as part of these projects means that there will be at least two opportunities for public comment.

· Public round-tables on key topics: The IASB will hold a series of public round-table discussions on two issues in which constituents have expressed particular interest. The first discussions will focus on the proposed amendments to the recognition and measurement principles in IAS 37 Provisions, Contingent Liabilities and Contingent Assets and will be held in November and December of this year. Later, the IASB will schedule a series of round-table discussions on issues relating to the range of measurement attributes, including aspects of cost and fair value, as part of its Conceptual Framework project.

The IASB announced the steps above following consultation with the Trustees of the IASC Foundation, the Standards Advisory Council, and a wide range of interested parties. Discussions with accounting standard-setters, regulators, preparers, users and auditors of IFRS statements have indicated a need for stability in the existing body of standards in the near term and a desire for increased consultation on matters concerning the IASB’s Conceptual Framework.

This series of initiatives will provide stability for preparers, users and auditors of IFRS statements while permitting the IASB to continue its convergence programme described in the FASB-IASB Memorandum of Understanding published in February 2006.

In announcing these steps, Sir David Tweedie, Chairman of the IASB, said:

For those concerned with International Financial Reporting Standards, the past few years have been a time of great activity. The IASB has listened to the needs of those involved with implementation of IFRSs throughout the world and is committed to provide stability until 2009. At the same time, many of those who follow the standard-setting process have expressed their desire to have greater input into our joint work with the US FASB. The steps announced today meet both concerns, while enabling us to make progress on our work aimed at eliminating the need for reconciliation requirements by 2009.

END

Press enquiries:

Sir David Tweedie, Chairman, IASB,

telephone: +44 (0)20 7246 6410, email: dtweedie@iasb.org

Notes to Editors

About the IASB

The International Accounting Standards Board (IASB), based in London, began operations in 2001. Contributions collected by its Trustees, the IASC Foundation, from the major accounting firms, private financial institutions and industrial companies throughout the world, central and development banks, and other international and professional organisations fund the operations of the IASB.

The 14 Board members (12 of whom are full-time) are drawn from nine countries and have wide international experience and a variety of functional backgrounds. The IASB is committed to developing, in the public interest, a single set of high quality, global accounting standards that require transparent and comparable information in general purpose financial statements. In pursuit of this objective, the IASB co-operates with national accounting standard-setters to achieve convergence in accounting standards around the world.