An official with the European Union said that U.S. companies with stocks listed on European exchanges will not be forced to conform to International Financial Reporting Standards, even as IFRS moves closer to convergence with U.S. generally accepted accounting principles.
The EU's internal market commissioner, Charlie McCreevy, told a European Federation of Accountants conference that he will propose that U.S. companies be able to file financial statements in accordance with U.S. GAAP without first reconciling them with IFRS, according to Accountancy Age.
The U.S. Securities and Exchange Commission recently decided to allow non-U.S. companies to file their financial statements in IFRS without reconciling them with GAAP (see SEC Removes Reconciliation Requirements). The SEC has also proposed allowing companies to file statements in accordance with IFRS.
In addition, McCreevy said there is no need for European regulators to provide new guidance at this time on auditing companies hit by the crisis in the U.S. subprime mortgage market. He noted that the major auditing firms were already discussing how to assess the accuracy of a company's exposure to such investments. However, Mark Olson, chairman of the Public Company Accounting Oversight Board, said guidance might still be needed to evaluate the fair value of assets such as bonds tied to subprime mortgages.
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