IFRSs and other news
Large
firms' joint paper on principles-based accounting
Widespread support for a principles-based approach to standard-setting has contributed to IFRS gaining increasing acceptance around the world. Surprisingly, however, there is currently little agreement on what principles-based standards are in practice or how standards-setters should aim to deliver them.
Given the anticipated extent of changes in IFRS in the coming years, the CEOs of the largest international audit networks (including Grant Thornton International) have published a White Paper "Principles-Based Accounting Standards". The White Paper aims to move the debate forward by suggesting a framework to use in developing principles-based standards. The Paper also recognises that cultural and behavioural changes will need to be made by other participants in the financial reporting process if a principles-based model is to succeed.
The White Paper proposes that principles-based accounting standards should:
| 1. |
give a faithful presentation of economic reality
|
| 2. |
be responsive to users¡¦ needs for clarity and transparency
|
| 3. |
be consistent with a clear Conceptual Framework
|
| 4. |
be based on an appropriately defined scope that addresses a broad area of accounting
|
| 5. |
be written in clear, concise and plain language
|
| 6. |
allow for the use of reasonable judgment |
The Discussion Paper can be downloaded at:
http://www.globalpublicpolicysymposium.com/GPPC_PBS_White_Paper.pdf
|