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Hoogervorst hints at accounting slowdown

Monday 23 January 2012 – by [email protected]

Hans Hoogervorst - photo by IFRS Foundation

International Accounting Standards Board chief Hans Hoogervorst has hinted that the standard setter is ready for a relative period of calm after a breakneck period of changes.

In a speech in Moscow, Hoogervorst said that the majority of respondents to a recent agenda consultation had called for the IASB to enter a period of quiet.

Last year, the IASB asked the industry to guide its future direction. Having recently initiated an influx of changes to its standards, along with ongoing projects to finalise alterations to the treatment of financial instruments, leases and insurance contracts, it had been suggested that the IASB slow the pace of change to ensure firms could adapt to the new requirements.

Hoogervorst said on Monday that “the most common request” from respondents is “for a period of calm”.

“In some cases this request is followed by ‘apart from this one very specific project’. The difficulty is that the ‘very specific project’ varies in different parts of the world, so difficult choices will have to be made if the period of calm is to become a reality,” he told the Ernst & Young IFRS seminar.

“However, I suspect that after the somewhat frenetic period of the last few years, a slowing down in the pace of change would be welcomed by most if not all of our constituents.”

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The Dutchman added that the IASB will take a “serious look” at completing its conceptual framework, which lays down the philosophical and methodological underpinning of its work.

He claimed “everyone” is asking the IASB to complete work in this area.

Additional areas where improvement has been urged include performance reporting and other comprehensive income, he said, though views of how it should go about these changes have been mixed.

He continued: “Our future agenda consultation recognises that many new jurisdictions such as Russia have their own legitimate requests – including foreign currency translation, business combinations under common control, agriculture and many more.

“We will have to make a judicious choice here, being mindful that we do not overload our agenda.”

The IASB is looking to provide a formal feedback statement on its future programme during the second quarter of 2012, according to a timeline on its website.

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