Investors could lose information about U.S. insurance operations if the United States moves too quickly to adopt international accounting standards, a U.S. accounting official says.
Robert Herz, chairman of the Financial Accounting Standards Board, Norwalk, Conn., and John Brennan, chairman of the Financial Accounting Financial, Norwalk, a nonprofit corporation that oversees FASB, give that assessment in a letter to the U.S. Securities and Exchange Commission.
Herz and Brennan wrote the letter in response to a request by the U.S. Securities and Exchange Commission for comments on the SEC’s “roadmap for potential use” of financial statements prepared using International Financial Reporting Standards.
FASB and FAF want to work with the International Accounting Standards Board, London, to improve both the U.S. Generally Accepted Accounting Principles standard and the IFRS, and to eliminate differences between U.S. GAAP and IFRS, Herz and Brennan write.
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“We believe these joint efforts will improve the quality of the standards and the comparability of financial information globally and will advance the efforts toward a single set of high-quality global accounting standards,” the officials write.
One challenge is that the FASB-IASB “memorandum of understanding” on working toward convergence of their standards does not address all existing differences between the standards, the officials write.