Could Norwalk Be Next?
Pure speculation here (I remind you of the disclaimer posted on the right side of this blog), but as we noted on Dec. 7, 2009 (citing speculation by then-FASB Chairman Bob Herz in remarks to the International Federation of Accountants, as noted in various articles published on Dec. 11, 2007):
"FASB Could Become Part of IASB, Herz Reportedly Tells IFAC Conference; SEC
To Meet Next Week." Here's what our post from Dec. 11, 2007 said:
There’s been a flurry of reporting on FASB Chairman Bob Herz’ remarks at the International Federation of Accountants (IFAC) 30th anniversary World Accountancy Forum earlier this week, in which Herz is reported to have said that in light of the move toward one global standard setter – and, as he has previously stated, that one global standard setter will one day be the IASB - FASB can essentially become a branch or satellite office of the IASB. This was reported in "FASB Sees Its Future as Part of IASB,” Accountancy Age, Dec. 7, “FASB Could Become Branch of IASB,” Webcpa, Dec. 6, and “FASB Members Suggest Board Could Become IASB ‘Satellite’ or U.S. Office,” BNA Daily Report for Executives, Dec. 7. The BNA article notes not only Herz remarks at IFAC on Dec. 4, but similar remarks by FASB board member Michael Crooch at yesterday’s (Dec. 6) FASB Accounting Standards Advisory Council (FASAC) meeting.*
BNA describes Herz' remarks at IFAC as "suggest[ing] IASB could have an office ‘in
the United States – maybe in Norwalk [Conn.]’ for example, and it ‘might have an office in Japan.’ BNA also notes Crooch told FASAC yesterday: “At some point, the FASB is going to have to be out of the business of writing accounting standards, if you’re going to have one global standard-setter.”
NOTE: As shown in the minutes of the Dec. 6, 2007 FASAC meeting, (para. 10, particularly para. 10d, pages 5-6 of minutes), some of the thinking at that time regarding a potential satellite office for the IASB in the U.S. was as follows:
The views expressed by FASAC members on the potential future direction and
organization of financial reporting may be summarized as follows:
... There should be one standard setter for one set of global standards, so the FASB cannot continue to exist in its current capacity. Instead, the FASB could act as a resource (or satellite office of the IASB) with 100 years of experience, collecting the views in the U.S. and presenting them to the IASB.
FASB, ASBJ, Hold 10th Meeting To Discuss Global Convergence
Last week, representatives of the FASB and the Accounting Standards Board of Japan (ASBJ) held the 10th in a series of meetings to continue a dialogue on global convergence.
The decisions connected with the use of IFRSs are expected to be
- during 2011 for the United States and
- in or around 2012 for Japan
....With those forthcoming decisions in sight, both the ASBJ and the FASB are vigorously conducting their respective convergence programs with the IASB.
... At this meeting, taking into account these trends, the ASBJ and the FASB updated each other with the recent developments in their respective convergence projects with the IASB. Furthermore, the ASBJ and the FASB exchanged views on [various convergence] projects...
...Ikuo Nishikawa, Chairman of the ASBJ, stated, “As the decisions connected with the use of IFRSs in both countries approach, it is extremely meaningful to exchange views with the FASB regarding financial instruments, revenue recognition, leases, and the measurement of liabilities, most of which are high priority MOU projects between the FASB and the IASB. I am pleased that we were able to affirm our continuing relationship between the ASBJ and the FASB under the leadership of newly appointed Chairman, Ms. Leslie Seidman. The ASBJ will continue to contribute to the development of high-quality, global accounting standards.”
Leslie F. Seidman, Chairman of the FASB, affirmed that notion, saying, “The FASB is committed to working cooperatively with the ASBJ on important issues related to the international convergence of accounting standards. Our dialogue on major joint projects with the IASB, and our shared interest in international convergence, are important to ensuring the future of high-quality financial reporting in both Japan and the United States. ”
The next joint meeting is planned in the summer of 2011 in Tokyo, Japan.
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