The Association of Chartered Certified Accountants wants world leaders who attend the G20 summit next month to endorse International Financial Reporting Standards, and to leave fair value accounting alone.
The international organization has issued a
The paper recommends that the financial regulatory framework be redesigned to accommodate increasingly complex financial structures. Steps have to be taken to improve the transparency and stability of financial markets.
“Specifically, the G20 needs to endorse the benefits of International Financial Reporting Standards because they bring transparency, comparability and clarity to reporting in the interests of shareholders, business and the wider public,” said Aitken Davies. “It is a major failing that IFRS are not already the global accounting language for all finance professionals.”
Fair value in financial reporting will also need to be considered by the G20, Aitken Davies added, but he defended the use of fair value measurement, which has come under attack by banking interests and by some in Congress. A congressional hearing is scheduled for Thursday to discuss mark-to-market and fair value accounting.
“ACCA does not believe that fair value accounting is a cause of the banking crisis,” said Aitken Davies. “The calls for its suspension can be seen as trying to sweep the problems under the carpet, which would, if allowed, risk undermining the remaining confidence in the financial system.”
