In their joint meeting in November 2010, the IASB and FASB decided to refocus their agenda on priority projects in order to secure their self-imposed June 2011 deadline for completing convergence projects.
The stakes are high. The US Securities and Exchange Commission (SEC) is considering whether to incorporate IFRS into the financial reporting system for U.S. issuers. The final decision should be taken in 2011.
“In 2011, upon conclusion of the fact gathering and analysis set forth in the work plan — and assuming completion of the convergence projects — the Commission will then be in a position to determine whether to incorporate IFRS into the financial reporting system for U.S. public companies.” (Speech by Mary L. Schapiro, SEC Chairman, Washington, D.C., Feb. 24, 2010)
The last version of the IASB work plan (20 December 2010, available on http://www.ifrs.org/) can be summarized as follows:
All these projects are “joint” projects, which means that they are co-developed with the FASB as part of the roadmap for convergence.
For all of them, exposure drafts have already been published.
Some of these projects introduce deep changes in accounting practices thus raising many concerns among preparers. As an example, for both leases project and revenue recognition project (which are major topics), the same kind of concerns have been expressed by the respondents in their comment letters:
Moreover, many respondents warn the Boards not to favor deadline - because of the 30 June 2011 commitment - over the quality of standards.
Once the June 2011 date has been met, the Board should then be able to resume its deliberations on the other projects (described as “important but less urgent”).
These other projects are the following:
However, the IASB will have to consult broadly when it comes to defining its future agenda.
Indeed, as part of the IFRS Constitution review completed in 2010, the decision was made to undertake a three-yearly public consultation on the IASB's future technical agenda, in addition to consulting the Trustees and the IFRS Advisory Council annually.
The first consultation will take place by 30 June 2011.
Before that, the IFRS Advisory Council has already expressed its advice on the post-2011 work plan. The broad outline can be summarized as follows:
As a conclusion, the IASB is now more than ever facing a tremendous challenge. The year 2011 will be crucial to strengthen (or undermine) its credibility as a global standard-setter.
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