Wednesday, March 7, 2007
Excerpts from Chairman Cox's Address to the SEC Roundtable on International Financial Reporting Standards (March 6,2007):
At the same time, the FASB and the IASB have embarked on a project to converge accounting standards, which as I noted was formalized in the Norwalk Agreement. Over the past few years, these efforts have gone far to reduce differences between the two sets of standards, and by all accounts, have improved both IFRS and GAAP in the process.
But accounting standards are complicated, and changing them can be difficult. And that inherent difficulty has led some to the view that the convergence of IFRS and U.S. GAAP is impossible — thus rendering the elimination of the reconciliation requirement an eternally unattainable goal. So let me repeat that we do not expect to see total convergence or even a specific level of convergence before eliminating the reconciliation requirement. Instead, there must be a robust and active process in place for converging IFRS and U.S. GAAP. If the process is in place, then the current differences will be minimized in due course.