Since 1973, the Financial Accounting Standards
Board has been the designated organisation in the US in the private sector for establishing standards of financial accounting and reporting.
The new accounting guidance note on First Time Adoption of AAOIFI Accounting Standards
provides Islamic financial institutions with the starting point for preparing financial accounting records and reports based on AAOIFI standards.
"We strongly support the eventual use of a single set of high-quality, comprehensive global accounting standards
by public companies in the preparation of transparent and comparable financial reports throughout the world, and thus continue to strongly support the objectives of the IASCF and the IASB," Melancon said.
(1.) The Financial Accounting Standards
Board is considering possible changes to the proposed Fair Value Measurements Standard.
In addition, almost hail of the countries reported that the tax-driven nature of their national accounting standards
make it difficult to adopt IFRS.
The cross-fertilization that's going on is the result of an agreement between the Financial Accounting Standards
Board (FASB) and the International Accounting Standards
Board (IASB) to make their existing financial reporting standards compatible with each other to better respond to the complexity of the world's markets (See "The Urge to Converge," page 70).
The IASB and predecessor committees and boards have been working on the idea of a single, international accounting standard
since at least 1966.
* Federal Acquisition Regulation (FAR) and Cost Accounting Standards
(GAS) Web site, www.arnet.gov/far, in particular Part 28.
The short-term convergence project is part of a comprehensive project to converge their respective accounting standards
into a common set of high-quality accounting standards
However, any change has to be credible and orderly, respecting the due process of formulating accounting standards
. Without retaining due process, standard-setting processes will become arbitrary and will be subjected to whatever strong influences happen to be present at the moment, no matter how harmful the long-term societal and economic consequences.
For example, he explains, "European Union (EU) businesses of all sizes all are adopting International Financial Reporting Standards (IFRS) of the International Accounting Standards
* In December the Financial Accounting Standards
Board (FASB) issued four exposure drafts that represent the first phase of a comprehensive project FASB and the International Accounting Standards
Board (IASB) have undertaken to "converge" their respective standards into a common set of high-quality accounting standards
"It will be interesting to see how many organizations have qualified opinions on internal controls," he says, adding, "[CCR] is very much tied to FASB's focus on fair value--it's probably our biggest concern." He's convinced that FAS 133--the accounting standard
on derivatives--and FIN 46, which covers special-purpose entities, "were mistakes.
Copyright [C] 2003 by Financial Accounting Standard