The U.S. Financial Accounting Standards Board and the International Accounting Standards Board have published a new memorandum of understanding -- reaffirming both groups' commitment to common accounting standards, and saying convergence is still a numbers of years away.
The memo builds on plans formally announced by the boards in late 2002, but says that the original goal of eliminating the need for reconciliation by 2008 will be pushed back.
It also contains a new roadmap, laying out goals for the next several years, and incorporates work from the Committee of European Securities Regulators that identified areas for improvement of accounting standards.
First, the boards plan to reach a conclusion about whether major differences in focused areas should be eliminated through short-term projects. If so, those projects could be mostly completed by 2008. Second, the boards will continue to discuss areas of both GAAP and IFRS that are in need of improvement.
"The pragmatic approach described in the memorandum enables us to provide much-needed stability for companies using IFRS in the near term, while taking advantage of a once-in-a-lifetime opportunity to contribute to removing the need for reconciliation," said IASB Chairman David Tweedie, in a statement.
The roadmap also addresses auditing and enforcement, topics that are not accounting standard-setting issues and will require the cooperation of regulators and auditors. The boards will next meet on April 27 and 28.
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