Australian accounting standards board keeps global advisory role

The Australian Accounting Standards Board (AASB) has won the battle to keep a coveted role advising the most powerful global financial reporting and accounting standards setting bodies.

The Australian Accounting Standards Board (AASB), in alliance with its New Zealand counterpart, has won the battle to keep a coveted role advising the most powerful global financial reporting and accounting standards setting bodies.

Australia will lobby in favour of tighter international accounting standards for insurance companies at the group’s next meeting in July.

Last week, the International Financial Reporting Standards Foundation and the International Accounting Standards Board announced the new composition of the 12-seat Accounting Standards Advisory Forum.

«It is a great testament to Australia’s international reputation that we were able to retain our place on the advisory forum,» Australian Accounting Standards Board chief executive Kris Peach said.

Feedback forum

The forum was set up two years ago in response to criticism that international standards and the international rulemaker had not been garnering feedback from enough of their member countries around the world. The advisory group meets four times a year. Appointments are for a three-year term.

Australia joined forces with New Zealand to beat out competition from Hong Kong and Singapore for its place among representatives from Asia. Other regional representatives reappointed were the China Accounting Standards Committee, Accounting Standards Board of Japan, and the Asian-Oceanian Standard-Setters Group – chaired by South Korea.

In Europe, the United Kingdom’s Financial Reporting Council, lost its bid to be reappointed and was forced to make way for the representative body from France. Spain also had to give up its seat to Italy.

Push for stricter guidelines

At the next ASAF meeting in London on 16-17 July, Australia will present two papers relating to the accounting rules for insurance companies. Australia is pushing for stricter international guidelines around how insurers disclose their discount rates and recognize contractual service margins.

«Australia is really advanced in terms of the accounting standards it applies to insurance providers and we have been a driving force behind the IASB’s efforts to lift standards in this area globally,» Ms. Peach said.

 Another priority for Australia is advocating for improvements to the «conceptual framework» used for developing international accounting standards. Australia is seeking a ruling on when historical or current values should be applied, as well as greater clarity on what should be recorded as «profit and loss» versus «other comprehensive income». 

 Source: Financial Review – By Sally Rose