London (Oct. 30, 2002) -- Marking a major step toward convergence on global accounting standards, domestic and international accounting rulemakers moved to formalize a joint project to eliminate the differences in accounting standards.

Following a two-day meeting in London this week, the U.S. Financial Accounting Standards Board and its overseas counterpart, the International Accounting Standards Board, agreed to add a joint short-term convergence project to their respective agendas to eliminate a number of differences between U.S. Generally Accepted Accounting Principles and International Financial Reporting Standards. The elimination of those differences is part of an overall effort by both boards to improve the comparability of financial statements across borders.

"Our agreement provides a clear path forward for working together to achieve our common goal" of producing high-quality worldwide reporting standards, FASB chairman Robert H. Herz said in a statement.

The boards said they expect to issue an Exposure Draft of proposed changes to U.S. GAAP or IFRSs by the latter part of 2003. Under the agreement, the FASB and the IASB pledged to work together to make existing reporting standards compatible "as soon as is practicable;" to coordinate their future work programs to remove other differences between IFRSs and U.S. GAAP that will remain on Jan. 1, 2005 -- the deadline for European Union countries to adopt IASB standards; and to continue working on joint projects currently underway.

-- Electronic Accountant Newswire staff

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