News
FASB, IASB Ready Rollout of New Standards
27-Jan-2016
NORWALK - Leaders of the Financial Accounting Standards Board and the International Accounting Standards Board are bracing for the release of the leasing standard and other standards that have been under development and generating debate for over a decade.
In a speech at the American Institute of CPAs' Conference on Current SEC and PCAOB Developments, in Washington, D.C., in early December, FASB Chairman Russell Golden said, "Our aim is to create a neutral playing field that enables investors, lenders and other users of financial statements to make their own independent judgments about where to invest, based on the best possible information available. To that point, the FASB is not a government agency, accounting standards are not regulations, and the FASB does not make economic policy decisions."
FASB plans to release the leasing standard early this year, along with standards’ updates from its financial instruments project, including impairment and classification and measurement. The IASB has already released its own financial instruments standards.
Golden acknowledged differences between FASB and the IASB's versions of the standards, along with disputes over the standards among others who have provided input. "You'll note that I've discussed a number of projects - impairment, leases and materiality, to name a few - about which there has been substantial disagreement among our stakeholders, and in some cases, among members of the board," he said. "It's our job to sort through all of those conflicting opinions and to take the action that we believe will best meet the needs of investors and others who use financial reports."
IASB Chairman Hans Hoogervorst also spoke at the Conference and encouraged the US to stay involved in setting International Financial Reporting Standards, despite the different approaches taken by FASB on some convergence projects.
"In the second week of January 2016, the IASB will publish its leasing standard," he said. "Our standard is converged with the FASB's standard in its main objective, namely to put most operating leases on the balance sheet. These can no longer lurk in the shadows as off-balance-sheet financing."
Hoogervorst pointed to the wider acceptance of IFRS in countries like China, India and Japan as signs that it is spreading globally. He sees positive signs in the US as well.