It's time for one.

• Author: McCrary, Deanna
• Position: InternationalStandards - Brief Article

You might not have noticed, but its happening right under your nose. For the past year the Financial Accounting Standards Board has been working in tandem with the London-based International Accounting Standards Board to bring U.S. accounting standards in line with international standards.

Current international standards were developed soon after the JASO, the IASB's predecessor, was founded in 1973. Today those standards are the norm for several countries around the world--except the United States, Japan and several European countries.

Currently, foreign registrants who use international standards are not accepted by U.S. or Japanese securities exchanges. "Every other country accepts them," says Mary Barth, IASB member and accounting professor at Stanford University. However, that is changing. If events unfold as planned, by 2005, all publicly listed companies within the European Union will conform to international standards.

"Everywhere I go around the world I hear from accountants and companies that they don't want to prepare financial statements with multiple sets of rules. It's crazy," says Barth. "Companies want [one standard]. With the increase in global investing over the years, global investors demand it. The international markets demand it."

According to Barth many differences in countries' standards are accidents of history--accidents that the IASB is working to fix.

THE IMPROVEMENTS PROJECT

In March the IASB will release an exposure draft outlining 12 improvements to the existing 41 international standards. Called the Improvements Project, the 12 proposed standards will be released with a two-year deadline to compare work. "It will be a question of who has the best answers," said IASB Chair Sir David TWeedie, at the UC Berkeley Conference on Financial Reporting last November. "It's not a question of 'winning.' The IASB just wants an international debate."

It is in CPAs' best interest to be on top of what the IASB is doing, says Barth, and to provide the board with comments. "We need input from everyone," she says, adding that the standard-setting process is analogous to FASB's.

NATIONAL STANDARD-SETTERS TO STAY

The United States has taken the lead in standard-setting. For example, Europe has no stock compensation standards, and the dot-bomb hit many European countries as hard as the United States. "International standards have equalized to FAS 133 but they are filled with compromises," said Tweedie. The IASB also is working on...