Governments and regulators need to step up initiatives to promote convergence to global accountancy and auditing standard, and they need to do so quickly according to over 60 leaders of the accountancy profession who attended the International Federation of Accountants’ (IFAC’s) G20 Accountancy Summit on July 23 and 24 in London. The summit was organized to achieve consensus by the profession on a series of recommendations to be made to the G20 leaders prior to their meeting in September on issues related to the financial crisis.

Participants unanimously agreed that the public interest would best be served by a single set of high-quality, principles-based financial reporting and auditing standards for listed and public interest entities.
Robert Bunting, IFAC President emphasesed that:
“It is critical that national standard-setting bodies establish roadmaps to move toward adoption of International Financial Reporting Standards and International Standards on Auditing,”

The group stressed the importance of having balanced views in the standard-setting process and ensuring that there is no undue influence from any one stakeholder group. They also emphasized the need for the International Accounting Standards Board to have a robust governance structure that will ensure its effectiveness and independence.
In addition, summit participants called upon governments to follow the same high standards of financial reporting as their private sector counterparts and to adopt International Public Sector Accounting Standards.

“The group expressed strong concerns about the liabilities and contingencies being assumed by governments in many countries as a result of the financial crisis,” explained IFAC Chief Executive Officer Ian Ball. “IFAC will continue to emphasize to the G20 the need for governments to provide clear and transparent reporting to their taxpayers and to capital markets.”

World Bank Chief Financial Management Officer Tony Hegarty addressed the group, highlighting the urgent need to develop and strengthen the profession in developing and emerging economies as a key step in achieving financial stability. He announced that the World Bank and IFAC will work together to develop a new initiative to deepen cooperation in this area. Summit participants supported this initiative and recommended that G20 governments should partner with the World Bank and IFAC to establish a framework for building sustainable capacity for the accountancy profession.

Other key recommendations from the group included the following: