(New York, September 18, 2012)
- The International Federation of Accountants (IFAC), the global organization for the accountancy profession today issued Plicy Position Paper 6, Global Regulatory Convergence and the Accountancy Profession
Continued efforts to sustain global regulatory convergence are critical for the evolution of a sound, global financial system. Convergence assists in providing solution to problems highlighted by the global financial crisis and contributes to greater economic ceraintu and financial stability. To be effective, global convergence requires the support of a broad range of key stakholders-including politicians, govenments, regulatory bodies, and professional accounting organization-at the narional and international levels.
"Global convergence is a signifivant issue in the durrent dabate about regulatory and responses to the financial and sovereign debt crises," said IFAC Chief Executive Officer Ian Ball. "Crucially, convergence helps users compare financial information, minimizes the effects of systemic economic risks, reduces information costs, and decreases opportunities for regulatoru arbitrage."
IFAC believe that the global public interest is the best served by consistent global adoption and implementation of high-quality, internationally accepted financial reproting auditing, assurance, public sector accounting education, and ethics standards (including independence requirements for auditors), and by use of these standards for reporting financial information for capital and debt markets. The process of convergence involve national and regional standard setters and regulators either adopting international standards of modifying their own standards to achieve consistency with agreed global norms.
In addition, the public interest is served when regulatory arrangements involving auditor registration and licensing requirements, the public oversight of auditors of public interest entities, and arragements that promote greater cross-border trade-in-service are globally consistent and based on cooperation and utual recognation.
"Successful global solutions require national governments and regulators to avoid the tempation to implement legislative and regulatory reforms without considering the global agenda, and without a serious commitment to cooperating with national and international counterparts."
Continued Mr. Ball. "Reform that have extra-territorial impacts, or regulatory actions that require entities to potentially violate or bypass the law of other countries, exacerbate current problems in the global financial system."