'Tragic consequences' if IFRS fails
Monday 13 December 2010 - by Andrew Hickley
International Financial Reporting Standards Foundation trustee Harvey Goldschmid has claimed that the goal of implementing a single set of high quality global accounting standards hinges on the US Securities and Exchange Commission adopting IFRS standards in 2011.
He warned that failure to apply the standards by this time could have two different "tragic consequences" towards the alliance of nations that already have them in place.
"First, the coalition of nations supporting IFRS could break apart. Rather than two sets of accounting standards, we could go back to pre-2000 fragmentation," he said. "The cost, in terms of lack of transparency and comparability, higher accounting expenses, etc., would be extremely large.
"The second basic scenario is even worse from a US perspective. The coalition in support of IFRS could hold and the US would become isolated. The US would no longer play the large and constructive role it now plays in IFRS development and oversight.
"I believe that without active US participation the overall quality of the international accounting standards would deteriorate."
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