The Group of 20 Leaders included a call for accounting convergence in their statement at the conclusion of their summit in Pittsburgh last weekend.
We call on our international accounting bodies to redouble their efforts to achieve a single set of high-quality, global accounting standards within the context of their independent standard-setting process, and complete their convergence project by June 2011, said the statement. The International Accounting Standards Boards institutional framework should further enhance the involvement of various stakeholders.
The International Federation of Accountants praised the G-20 leaders statement, which also included support for a framework for strong, sustainable and balanced growth, including reform of executive compensation packages, and increased resources for the World Bank and international development banks. IFAC recommends that these goals remain priorities and that G-20 leaders act on them at a national level.
Two issues at the top of IFACs agenda, which were reflected in its submission to the G-20 finance ministers in July, are the need for governments to address corporate governance issues and to move ahead on implementing common global standards not only for accounting, but also for auditing and for auditor independence.
IFAC shares the G-20s view that systems of remuneration should provide incentives consistent with long-term growth and corporate performance, said IFAC president Robert Bunting. The time has come to act on that view.
IFAC has recommended that the G-20 nations adopt and implement the Organization for Economic Cooperation and Developments Principles of Corporate Governance and for them to ask the OECD to address the design of remuneration systems within its corporate governance framework. In addition, IFAC has strongly urged governments to support an increased role for corporate audit and compensation committees and for ensuring that members of these committees have the appropriate expertise.
As part of its governance recommendations, IFAC has called for competency requirements for those preparing financial statements. IFAC believes these competency requirements should apply not only to those working in listed companies, but also to those preparing governmental financial reports.
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