Sir David Tweedie asks: 'what's the U.S. going to do about IFRS?

• Author: Sinnett, William M.
• Position: Financial reporting - International Financial Reporting Standards - Conference news

Sir David Tweedie, chairman of the International Accounting Standards Board, spoke with reporters in New York recently following an IFRS Summit, conducted by Deloitte for clients.

According to Sir David Tweedie, June 2011 is an important date for all involved in financial reporting. It is the date the Group of 20 leaders set as the goal to complete global convergence in accounting standards. "While attention has predominantly focused on the United States' own plans, the rest of the world has not sat back and waited for U.S. leadership," he said.

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Tweedie reported that recent estimates put the number of countries currently using International Financial Reporting Standards at 117, with a raft of other major economies coming on board in the run-up to 2011, the G-20 target date. Those nations include Canada, India, Japan and Korea.

So, Tweedie asked: What's the U.S. going to do? Recent statements from U.S. Securities and Exchange Commission Chairman Mary Schapiro and Chief Accountant James Kroeker have indicated the SEC expects to make this decision a priority, and soon (no comments by presstime). These statements, said Tweedie, have been heard around the world in countries that have adopted IFRS and those still on the fence. The thinking now is, "Ah, this isn't dead" [in the U.S.].

He said he understands the SEC has had higher priorities in the recent past, referring to the financial crisis. With all it had on its plate, he said, "to start talking about changing accounting standards doesn't seem the most productive thing." And, he added, especially, "when you're talking about system changes in the middle of a [financial] crisis." The time lag is certainly understandable. "I would've done exactly what she [Schapiro] did, taking time to study it."

But he doesn't believe Schapiro expected how her comments would be "read" internationally, as she hadn't experienced the "accounting politics of the world at that stage," he said, adding, "And there's plenty of it."

In essence, he said the U.S. has been making this decision for the past seven years. He feels strongly that the U.S. needs to get involved so that it will be part of the decision-making for what global accounting will eventually become. The U.S., he said, may think it doesn't need to change its model, "it's quite different from most of the others."

The others, he said, have taken the standards on the basis that it's for "inward investment." Who knows Indian or...