SEC Welcomes Plans of U.S., International Standard Setters for Convergence of Accounting Systems; Press Release No. 2006-27; February 27, 2006
The SEC welcomed a 2006 agreement between FASB and IASB to converge U.S. GAAP and IFRS over 2006–2008, aiming to eliminate reconciliation requirements for foreign issuers and enhance global financial transparency, with no fraud, charges, or financial penalties involved.
The SEC endorsed a memorandum of understanding between the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) to align U.S. GAAP and International Financial Reporting Standards (IFRS) from 2006 to 2008. The initiative, supported by SEC Chairman Christopher Cox and Acting Chief Accountant Scott Taub, sought to eliminate the mandatory reconciliation of IFRS-based financial statements to U.S. GAAP for foreign private issuers, targeting key areas like leases and consolidations identified in a 2005 SEC staff report on off-balance-sheet entities. No fraud, misconduct, financial penalties, or legal charges were associated with this regulatory convergence effort—it was a policy-driven move to improve investor protection and global financial transparency.
The SEC publicly welcomed a 2006 memorandum of understanding between the FASB and IASB to advance the convergence of U.S. Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS) over the 2006–2008 period. SEC Chairman Christopher Cox emphasized the agency’s commitment to eliminating the requirement that foreign private issuers reconcile their IFRS financial statements to U.S. GAAP, calling it a critical step toward global harmonization. Acting Chief Accountant Scott Taub affirmed that joint efforts by the two standard-setting bodies would improve the quality and comparability of financial information for investors worldwide. The work plan specifically targeted areas such as leases and consolidations, which had been flagged in the SEC’s June 2005 staff report on off-balance-sheet arrangements and special purpose entities. This initiative was purely regulatory and collaborative, involving no allegations of fraud, misconduct, or enforcement actions. No individuals or entities were charged, and no financial penalties were imposed. The outcome was a strategic policy commitment to enhance transparency, reduce compliance burdens, and strengthen investor protection through globally aligned accounting standards.
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- Sec Welcomes Plans of U.S., International Standard Setters for Convergence of Accounting Systems
- Sec Welcomed Announcement by the Financial Accounting Standards Board (Fasb) and the International Accounting Standards Board (Iasb) of a Memorandum of Understanding About Their Work Plans from 2006-2008
- Those Plans Indicate Commitment to Make Measurable Progress Towards Improved and Converged Standards in a Number of Areas Over the Next Several Years
- Sec Chairman Christopher Cox Stressed Agency's Commitment to a Roadmap for Elimination of the Requirement That Foreign Private Issuers Reconcile Financial Statements Prepared Using International Financial Reporting Standards to the U.S. System of Generally Accepted Accounting Principles (Gaap)
- Sec Is Working Diligently Toward the Goal of Eliminating the Existing Ifrs to U.S. Gaap Reconciliation Requirement
- Achieving That Goal Depends On Contributions of Many Parties, Including U.S. and International Standard Setters
- This Important Step by Iasb and Fasb Will Help Ensure Investor Protection Remains Paramount in These Efforts
- The Work Plan Communicates Continued Commitment to Improving Financial Information for Investors
- Having the Iasb and the Fasb Address These Issues Jointly Should Further Efforts to Converge Accounting Standards
- Investors in the U.S. and Around the World Will Be the Long-Term Beneficiaries Of Converging Toward a Common Set of High Quality Accounting Standards
- Taub Added That in Addition to Making a Helpful Contribution in Moving Forward on the Roadmap for Eliminating the Need for Reconciliation Between Ifrs and U.S. Gaap, the Work Plans Would Cover Several Other Important Areas, Including Leases and Consolidations, Which Were Identified as Needing Improvement in the June 2005 Sec Staff Report On Arrangements with Off-Balance Sheet Implications, Special Purpose Entities, and Transparency of Filings by Issuers
SEC Welcomes Plans of U.S., International Standard Setters for Convergence of Accounting Systems FOR IMMEDIATE RELEASE 2006-27 Washington, D.C., Feb. 27, 2006 — The Securities and Exchange Commission today welcomed the announcement by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) of a memorandum of understanding about their work plans from 2006-2008. Those plans indicate a commitment to make measurable progress towards improved and converged standards in a number of areas over the next several years. In recent weeks, SEC Chairman Christopher Cox has publicly stressed the agency's commitment to a "roadmap" for elimination of the requirement that foreign private issuers reconcile financial statements prepared using international financial reporting standards to the U.S. system of Generally Accepted Accounting Principles (GAAP). “The SEC is working diligently toward the goal of eliminating the existing IFRS to U.S. GAAP reconciliation requirement," he said today. "Achieving that goal depends on the contributions of many parties, including U.S. and international standard setters. This important step by IASB and FASB will help ensure that investor protection remains paramount in these efforts." “The work plan communicates a continued commitment to improving financial information for investors,” observed SEC Acting Chief Accountant Scott A. Taub. “Having the IASB and the FASB address these issues jointly should further the efforts to converge accounting standards. Investors in the U.S. and around the world will be the long-term beneficiaries of converging toward a common set of high quality accounting standards.” Taub added that in addition to making a helpful contribution in moving forward on the roadmap for eliminating the need for reconciliation between IFRS and U.S. GAAP, the work plans would cover several other important areas, including leases and consolidations, which were identified as needing improvement in the June 2005 SEC Staff “Report On Arrangements with Off-Balance Sheet Implications, Special Purpose Entities, and Transparency of Filings by Issuers” (http://www.sec.gov/news/studies/soxoffbalancerpt.pdf). http://www.sec.gov/news/press/2006-27.htm Home | Previous Page Modified: 02/27/2006
SEC Welcomes Plans of U.S., International Standard Setters for Convergence of Accounting Systems FOR IMMEDIATE RELEASE 2006-27 Washington, D.C., Feb. 27, 2006 — The Securities and Exchange Commission today welcomed the announcement by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) of a memorandum of understanding about their work plans from 2006-2008. Those plans indicate a commitment to make measurable progress towards improved and converged standards in a number of areas over the next several years. In recent weeks, SEC Chairman Christopher Cox has publicly stressed the agency's commitment to a "roadmap" for elimination of the requirement that foreign private issuers reconcile financial statements prepared using international financial reporting standards to the U.S. system of Generally Accepted Accounting Principles (GAAP). “The SEC is working diligently toward the goal of eliminating the existing IFRS to U.S. GAAP reconciliation requirement," he said today. "Achieving that goal depends on the contributions of many parties, including U.S. and international standard setters. This important step by IASB and FASB will help ensure that investor protection remains paramount in these efforts." “The work plan communicates a continued commitment to improving financial information for investors,” observed SEC Acting Chief Accountant Scott A. Taub. “Having the IASB and the FASB address these issues jointly should further the efforts to converge accounting standards. Investors in the U.S. and around the world will be the long-term beneficiaries of converging toward a common set of high quality accounting standards.” Taub added that in addition to making a helpful contribution in moving forward on the roadmap for eliminating the need for reconciliation between IFRS and U.S. GAAP, the work plans would cover several other important areas, including leases and consolidations, which were identified as needing improvement in the June 2005 SEC Staff “Report On Arrangements with Off-Balance Sheet Implications, Special Purpose Entities, and Transparency of Filings by Issuers” (http://www.sec.gov/news/studies/soxoffbalancerpt.pdf). http://www.sec.gov/news/press/2006-27.htm Home | Previous Page Modified: 02/27/2006