ACCA urges ASB to get on with IFRS convergence
The UK's Accounting Standards Board has been urged by ACCA (the Association of Chartered Certified Accountants) to ignore calls to suspend its programme of converging UK accounting standards with International Financial Reporting Standards (IFRS).
ACCA believes that recent requests within the profession for the ASB to freeze the convergence programme are impractical. But it believes the ASB should allow companies to go for a 'big bang' option as an alternative to a phased convergence under which UK standards will be gradually replaced with their IFRS equivalents over 3 or 4 years.
Richard Martin, ACCA Head of Financial Reporting, said: "Convergence with IFRS should continue. Now that IFRS for listed companies has come in, the ASB should focus its attention on other UK companies, and many of them would probably prefer a swift change-over rather than a long drawn-out period of continuing changes and restatements, as is currently scheduled.
"Some have expressed fears that unlisted companies in Britain will have to undergo a double shift – firstly from UK standards to IFRS and then a simplified version introduced by the International Accounting Standards Board shortly afterwards. But rather than stopping convergence, we believe the UK's ASB should focus on using the template set by IASB on standards for Small and Medium-Sized Enterprises (SMEs) – this represents the vast majority of UK companies."
Richard Martin added: "In its standards for SMEs the IASB is currently consulting on where significant recognition and measurement differences might be made compared to full IFRS. This might delay UK convergence in these areas, but we believe there is still scope for significant convergence to continue."
In its response to the ASB's consultation document "Accounting standard-setting in a changing environment: the role of the ASB", ACCA also suggests that if the ASB is to continue with its current role of acting as a conduit for the views of UK stakeholders to the IASB, then it needs to be more actively engaged with those groups.