FASB-IASB Update G20 Leaders With Progress Report On Convergence

Yesterday, FASB and the IASB sent a letter to the G20 Leaders, updating them with details of the modification to their plan for convergence of accounting standards, first noted in a brief letter to the G20 Finance Ministers on June 2nd.

The letter includes a 15-page detailed progress report, which shows some projects moving beyond the original June, 2011 deadline (generally, to no later than "4Q2011") although there are a few references to 2012 and beyond, such as for derecognition and emissions trading schemes.

The FASB-IASB letter emphasizes:

We understand the importance that the G20 Leaders attach to the issue of accounting standards. At the Pittsburgh Summit, held in September 2009, the G20 leaders stated “We call on our international accounting bodies to redouble their efforts to achieve a single set of high quality, global accounting standards within the context of their independent standard setting process, and complete their convergence project by June 2011. The International Accounting Standards Board’s (IASB) institutional framework should further enhance the involvement of various stakeholders...

We also noted that many stakeholders have voiced concerns about their ability to provide high quality input on the large number of major exposure drafts that were planned for publication in the second quarter of this year...

The Pittsburgh Leaders Statement [G20 Leaders Summit, 2009]highlighted the importance of stakeholder engagement. We believe the modified work programme, which phases the publication of exposured drafts and related consultations, enables the broad-based and effective stakeholder participation in due process that is critical to the quality of our standards.

The nature of the comments received on our exposure drafts will determine the extent of the redeliberations necessary and other steps and efforts that will be required to reach this goal.

The last sentence noted above could also significantly impact the ultimate timing of final standards; i.e., the extent and nature of comments received on the FASB-IASB Exposure Drafts (proposals), not only the time it takes the boards to issue the proposals, but the time it takes them to 'redeliberate' the proposals by considerig comment letters received, and feedback received in other outreach, such as at conferences, roundtables, meetings with professional associations, (e.g., FEI's Committee on Corporate Reporting and Committee on Private Company Standards sent the following comment letters to the boards recently regarding the convergence timetable: FEI CCR letter; FEI CPC-S letter).

The June 25 FASB-IASB correspondance to the G20 leaders was addressed to The Honourable Stephen Harper, Prime Minister of Canada, host of the G20 Toronto Summit set to take place June 26-27 in Toronto.

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