SEC Proposes Roadmap Toward Global Accounting Standards to Help
Investors Compare Financial Information More Easily
FOR IMMEDIATE RELEASE
2008-184
Washington, D.C., Aug. 27, 2008 — The Securities and Exchange
Commission today voted to publish for public comment a proposed Roadmap
that could lead to the use of International Financial Reporting Standards
(IFRS) by U.S. issuers beginning in 2014. Currently, U.S. issuers use U.S.
Generally Accepted Accounting Principles (U.S. GAAP). The Commission would
make a decision in 2011 on whether adoption of IFRS is in the public
interest and would benefit investors. The proposed multi-year plan sets
out several milestones that, if achieved, could lead to the use of IFRS by
U.S. issuers in their filings with the Commission.
The increasing integration of the world's capital markets, which has
resulted in two-thirds of U.S. investors owning securities issued by
foreign companies that report their financial information using IFRS, has
made the establishment of a single set of high quality accounting
standards a matter of growing importance. A common accounting language
around the world could give investors greater comparability and greater
confidence in the transparency of financial reporting worldwide.
"An international language of disclosure and transparency is a goal
worth pursuing on behalf of investors who seek comparable financial
information to make well-informed investment decisions," said SEC Chairman
Christopher Cox. "The increasing worldwide acceptance of financial
reporting using IFRS, and U.S. investors' increasing ownership of
securities issued by foreign companies that report financial information
using IFRS, have led the Commission to propose this cautious and careful
plan. Clearly setting out the SEC's direction well in advance, as well as
the conditions that must be met, will help fulfill our mission of
protecting investors and facilitating capital formation."
Chairman Cox noted that since March 2007, the Commission and staff have
held three roundtables to examine IFRS, including one earlier this month
regarding the performance of IFRS and U.S. GAAP during the subprime
crisis. Almost one year ago, the Commission issued a concept release on
allowing U.S. issuers to prepare financial statements using IFRS.
Today, more than 100 countries around the world, including all of
Europe, currently require or permit IFRS reporting. Approximately 85 of
those countries require IFRS reporting for all domestic, listed
companies.
Public comment on the SEC's proposing release should be received by the
Commission no later than 60 days after its publication in the Federal
Register.
* * *
The full text of the SEC's proposing release will be posted to the SEC
Web site as soon as possible.
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http://www.sec.gov/news/press/2008/2008-184.htm