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IFRS Action: SEC Releases Reports, FAF Files Letter

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IFRS Action: SEC Releases Reports, FAF Files Letter

A number of significant developments took place in November 2011 with respect to the U.S. Securities and Exchange Commission's impending decision regarding whether, how, and when to incorporate International Financial Reporting Standards into the U.S. financial reporting system.

On Nov. 17, the SEC staff issued two significant reports, one comparing U.S. generally accepted accounting principles to IFRS, and one describing the SEC staff's observations as to the current application of IFRS by large global filers. Read more in the FEI blog.

Separately, the Financial Accounting Foundation, which oversees the Financial Accounting Standards Board, filed a comment letter on the SEC staff's May 2011 paper, which suggested a method of incorporating IFRS into U.S. GAAP, combining elements of convergence and endorsement (i.e. endorsement of IFRS on an ongoing basis by FASB as the U.S. national standard setter, similar to the process used by various countries that have adopted IFRS), an approach first coined as "condorsement" by SEC Deputy Chief Accountant Paul Beswick in a December 2010 speech.
Read more here about FAF's suggestions regarding refinements to condorsement, and FAF's views as to the future role of FASB once the convergence projects outlined in the FASB-IASB's Memorandum of Understanding are completed.