The International Federation of Accountants has just concluded its two-day G20 Accountancy Summit in London and issued a call for governments and regulators to adopt international standards, fast.
At the summit, the leaders of over 60 accountancy bodies came together to reach consensus on the recommendations they plan to present to the Group of 20 world leaders before they meet in September. IFACs most urgent recommendation was for governments to move more quickly on adopting International Financial Reporting Standards.
It is critical that national standard-setting bodies establish roadmaps to move toward adoption of International Financial Reporting Standards and International Standards on Auditing, said IFAC president Robert Bunting in a statement.
The roadmap reference seems to be aimed at SEC Chair Mary Schapiro, who has yet to give the thumbs-up to the roadmap proposed by her predecessor, the now much-maligned Christopher Cox. Schapiro has been busy of late trying to attend to the fallout from the financial crisis, and its impact on the reputation of the SEC. But the accounting profession has grown impatient waiting for the roadmap to be voted up or down.
IFAC also took aim at efforts by government regulators to step on the toes of accounting standard-setting bodies. The group stressed the importance of having balanced views in the standard-setting process and ensuring that there is no undue influence from any one stakeholder group, said a press release. They also emphasized the need for the International Accounting Standards Board to have a robust governance structure that will ensure its effectiveness and independence. In addition, summit participants called upon governments to follow the same high standards of financial reporting as their private sector counterparts and to adopt International Public Sector Accounting Standards.
Other recommendations from IFAC include:
· The needs of small and medium enterprises should be considered in the development of standards, as well as in any re-regulation.
· The G20 should continue to make strengthening corporate governance a priority. Focus should be placed on examining the role of independent directors, CFOs, and audit committees, as well as improving the linkage of remuneration schemes with performance.
· There is a need for a more robust financial reporting model that includes, among other things, reporting on sustainability and environmental issues.
IFAC plans to send these and other recommendations to the G20 in a communiqué within the next two weeks.
Setting a tight deadline helps, IFAC seems to be hinting.