FASB, IASB Extend Convergence Deadline 'By A Few Months'

Earlier today, Financial Accounting Standards Board Chairman Leslie Seidman and International Accounting Standards Board Chairman David Tweedie jointly announced the decision to “extend by a few months” their work on major convergence projects which, according to the boards' updated Memorandum of Understanding, had been slated to be completed by June, 2011. The projects for which the June, 2011 deadline has been extended 'by a few months' include the revenue recognition, leasing, financial instruments, and insurance projects. The announcement was made during an interview of the FASB and IASB chairmen at the conclusion of this week's joint FASB-IASB board meetings; the interview was conducted by IASB Communications Director Mark Byatt. Explaining the boards' decision, Seidman said:

After evaluating the issues yet to be addressed we jointly concluded that, without extending the work out indefinitely, we all could benefit from a few more months to develop these standards, some of which really go to the core issues of many companies.

Tweedie added:

[W]e have decided to extend the timetable for a few additional months to enable us to check whether our conclusions will last the test of time. We are also mindful of the G20 target, we have been reminded of that many times over the last few years, and we intend to try to finish this convergence programme by end of 2011. The June target has helped us to get there but at the same time it is clear that we need a little more time to check the conclusions, and to ensure that the standards are of the highest quality.

Seidman then noted:

[O]ur next step is to lay out the plans for the completion of the work on the remaining projects. This is going to include: how are we going to complete our technical discussions, and importantly, how are we going to consult with stakeholders as we move forward to finalising these standards.

Significantly, Seidman added:

We intend to post our conclusions on those items in the next convergence progress report, which is due to be published in the next few days

Listen to the podcast of today's announcement; read the transcript.

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