IAS 39: Where Different Accounting Models Collide

Click to increase image sizeClick to decrease image size

Notes

1. David Damant is now chairman of the Consultative Advisory Group to the International Auditing and Assurance Standards Board. He was formerly chairman of the Accounting Advocacy Committee of the UK Society of Investment Professionals and a member of the IASB's Standards Advisory Council.

2. The TEG dissenters cite IAS 1 (para. 16) that ‘inappropriate accounting policies are not rectified by disclosure of the accounting policies used or by notes or explanatory material’.

3. Recommendations on Shaping IASC for the Future, IASC, November 1999, p.6.

4. In evidence to the IASC foundation constitutional review, the current SEC Chief Accountant, Donald Nicolaisen said he thought it was “critical to have an independent professional accounting standard setting board.” He noted the focus should be “on individual excellence and a need for a mix of perspectives, without the need for overly rigid quotas as to professional background or geographic origin.”

5. ‘De façon plus générale, je crois nécessaire et urgent, à la lumière de l'éxperience, d'engager une nouvelle reflection sur le dispositif institutionnel d'adoption des normes comptables appelées à s'appliquer à nos enterprises européennes. Il me paraît ainsi essential que l'Union européenne, la Commission et les Etats members soient en mesure de peser davantage sur l'élaboration des normes par l'International Accounting Standards Board.’ From a letter to Romano Prodi, President of the European Commission, 4 July 2003.

6. Harry Schmid retired from the Board at the end of March 2004.

7. The JWG's draft standard was published by the IASC in December 2000. As referred to above, it proposed a standard where all financial instruments were carried at fair value, and no hedge accounting was allowed.

8. When the newly-formed IASB debated endorsing the existing IAS, some members argued that IAS 39 should not be endorsed because it was a bad standard and only interim.

9. For example, World Accounting Report, March 2004, p.2 says: ‘At the 20 January EcoFin Council, [Commissioner] Bolkestein had received the EU Finance Ministers' blessing to pursue his “difficult discussions” with the IASB’.