In April 2011, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) released a joint progress report regarding their convergence program for U.S. generally accepted accounting principles (U.S. GAAP) and International Financial Reporting Standards (IFRS). The FASB and IASB explained that they had completed five important projects under their memorandum of understanding (MOU). However, three projects have yet to be completed: revenue recognition, leasing and financial instruments. The FASB and IASB are also working on an insurance contracts project outside of the MOU. The progress report stated that the FASB and IASB anticipate completing the projects in the second half of 2011. The report represents a relatively short delay compared to earlier projections. In November 2010, the FASB and IASB announced that they anticipated completing the three projects by June 2011. A final standard regarding insurance contracts is not expected until 2012. At the same time that the FASB and IASB were releasing these joint reports, related press releases and other materials, the Securities and Exchange Commission (SEC) announced that it will sponsor a Roundtable on July 7, 2011 to discuss benefits or challenges in potentially incorporating IFRS into the financial reporting system for U.S. issuers.
In a podcast broadcasted in connection with the release of the progress report, FASB Chairman Leslie Seidman explained that, with respect to each individual project, the FASB and IASB will need to determine, prior to completion of the project, whether re-exposure of the applicable standard is necessary. Chairman Seidman explained that the re-exposure may be done formally or informally. Re-exposing the standards for public review will extend the time necessary for completion of any given project. The Financial Executives International immediately wrote to the chairs of the FASB and IASB boards asking that Exposure Drafts be released regarding each project with 90-day comment periods.
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