Emphasizing the 'international' in FEI.

• Author: Cangemi, Michael P.
• Position: President's page - Preeminent association international

In January 2001, FEI's leadership approved a name change to substitute the word "International" for "Institute" in our organization's name. At the time, leadership was wisely recognizing the tremendous increase in business globalization, which was not, and is not, just a large-company phenomenon.

Very large companies continue to expand worldwide, but smaller businesses, too, are connecting as a result of international sales expansion or acquisitions. During my recent travels, I've met many members whose businesses have related entities or sales outside the U.S. This globalization trend is expanding very rapidly.

In the November 2007 President's Page, I reported on the globalization of capital markets. Total worldwide market capitalization has doubled to $60 trillion in 2007 from $30 trillion in 2003. I further noted the mergers of national exchanges, which are creating worldwide capital exchanges that may someday supersede national markets.

When FEI became Financial Executives International, its leaders sensed it was important to reflect these trends in our title. I see eight macro international trends that demonstrate the acceleration of globalization and the need to continue FEI's international evolution. They are:

1. Advancement of globalized business and communications.

2. Consolidation/convergence of worldwide capital markets--and need for efficiencies, transparencies and an accepted governance platform.

3. Rapid worldwide acceptance of International Financial Reporting Standards (IFRS) accounting and reporting standards.

4. Movement towards expanded review of internal control and a related need for a common approach to internal control frameworks worldwide (see President's Page, December 2007).

5. Increasing cost of audits--and the need for more international audit firms to increase competition.

6. Need for effective representation on the International Accounting Standards Board (IASB) and related subcommittees.

7. Expansion of business process outsourcing (BPO) to include financial operations worldwide.

8. The need for a common extensible Business Reporting Language (XBRL) financial reporting taxonomy.

Perhaps the most significant globalization trend is the acceptance of international accounting standards for international reporting. IASB has been working hard at this, linking with the U.S.'s Financial Accounting Standards Board (FASB) to jointly produce a new conceptual framework for accounting standards and converge existing standards...