The SEC’s decision on whether to incorporate IFRS for U.S. issuers is at least a few months away.
SEC Chief Accountant James Kroeker said the SEC staff will need at least a few more months to produce a final report that would position the commission to make a determination on IFRS.
“Given the number of things on our agenda, I can’t give you a precise schedule,” Kroeker said at the AICPA National Conference on Current SEC and PCAOB Developments in Washington. “What I can tell you is that we will do so carefully and thoughtfully, being guided by an ideal that produces the maximum benefit for the investing public and the capital markets.”
An SEC statement in February 2010 had indicated that a decision could come as early as 2011, Kroeker said, but that won’t be the case.
Kroeker reported mixed results, at best, on a number of convergence projects being undertaken by FASB and the IASB.
He said converged standards have been completed that have resulted in increased transparency related to items reported in other comprehensive income. Kroeker said the boards also have fully converged guidance for determining fair value for financial reporting purposes.
The prospect for global, consistent standards relating to revenue recognition and leasing also is getting closer to reality, Kroeker said. He said both boards have issued revised proposals that address concerns about complexity and introduce a degree of pragmatism.
But prospects for a globally converged solution on the Memorandum of Understanding project on financial instruments have not been as encouraging, Kroeker said. A time frame on an improved impairment model is uncertain.
The boards are not aligned in their approaches to consideration of hedge accounting in the context of the financial instruments project, Kroeker said. Numerous questions have emerged that Kroeker said need to be considered by both boards.
“I continue to believe that it’s critical, as it relates to each of the MOU projects, that the boards take all reasonable steps to maximize the prospects of converged, high-quality solutions,” he said.
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