AICPA President and CEO Barry Melancon sent a letter to the leadership of the House Financial Services Committee on Wednesday to state that the Institute is “strongly opposed” to any legislation that would “undermine the independent accounting standard process as currently carried out by the Financial Accounting Standards Board (FASB).”
Melancon’s letter refers to language being considered by Rep. Ed Perlmutter, D-Colo., to amend the Financial Stability Improvement Act of 2009. The letter says Perlmutter’s proposal would hand over responsibility for overseeing accounting standards to the agencies being contemplated to oversee systemic risk, effectively removing the SEC as the primary overseer of FASB.
Melancon said the Institute opposes this approach because FASB and the SEC operate in harmony to ensure “that U.S. capital market participants receive the best possible financial information on public companies so that current and potential investors can make decisions and allocate capital efficiently.” He added that the agencies being considered to oversee systemic risk would not have the “same focus on the importance of the U.S. financial reporting system related to the setting of accounting standards for public companies.”
The Center for Audit Quality, the U.S. Chamber of Commerce and the Council of Institutional Investors expressed similar opposition to the idea of removing FASB from the SEC’s purview in a joint letter to the House Financial Services Committee on Monday.
Melancon noted that the SEC and FASB “have made great strides” to improve financial reporting, and that if Congress follows through on Perlmutter’s proposal, “it will be viewed by many as disregard for the interests of investors.”