Ask FERF about ... international standard-setting organizations.

With acronyms of international accounting and auditing standard-setting organizations bubbling up alongside U.S. organizations in an increasingly dense "alphabet soup," much confusion can arise. As convergence becomes more of a reality, it's a good time to get familiar with these organizations. FERF has prepared the following list of significant global organizations as a guide:

CAG [Consultative Advisory Group of IAASB] Provides technical input and advice to the IAASB. Members include regulators, preparers, users of financial statements and others.

CESR [Committee of European Securities Regulators] Formed by the European Commission (EC) to improve coordination among securities regulators, act as an advisory group to the EU and ensure consistent implementation among members.

EC [European Commission] Issues directives in matters relating to accounting, auditing and corporate governance. EC's Internal Markets Committee and Committee on Auditing are involved in policy issues relating to the quality and transparency of reported financial information; also takes part in EC efforts to coordinate with international standard-setters such as the IASB, IFAC and World Bank.

EU [European Union] EU's Accounting Regulatory Committee (ARC) considers issues regarding endorsement of IAS/IFRS for use within the EU. The EU's Contact Committee is an advisory body that advises the EC on its accounting directives.

EFRAG [European Financial Reporting Advisory Group] A private-sector, privately funded group formed to proactively contribute to the work of the IASB and to advise the EU's ARC and CESR on endorsement of international accounting standards. EFRAG has a Technical Expert Group (TEG) and a Supervisory Board of European Organizations. The EC, IASB and CESR are observers of EFRAG.

IAASB [International Accounting and Auditing Standards Board] Part of IFAC, issues International Standards on Auditing (ISAs), International Standards on Quality Control (ISQCs) and other standards relating to ethics, education, assurance and other services. See also CAG.

IASB [International Accounting Standards Board] An independent, privately funded accounting standard-setter. Its board comes from nine countries. IASB is committed to developing a single set of high-quality, understandable and enforceable global accounting standards. In addition, it cooperates with national accounting standard-setters, including the U.S. Financial Accounting Standards Board (FASB), to achieve convergence in accounting standards.

IASB's International Accounting Standards (IAS) and International Financial Reporting Standards (IFRSs) are adopted by various countries and mandatory (with certain exceptions) for listed companies in the EU effective 1.05.

IASCF [International Accounting Standards Committee Foundation] Oversees IASB and its funding.

IFAC [International Federation of Accountants] The global organization for the accountancy profession. U.S. members include the American Institute of Certified Public Accountants (AICPA), the Institute of Management Accountants (IMA) and the National Association of State Boards of Accountancy (NASBA). IFAC issues auditing standards through the IAASB and also issues various education, ethics and public-sector reporting standards.

IFRIC [International Financial Reporting Interpretations Committee] Formerly the Standing Interpretations Committee (SIC), it's the IASB's interpretive body. It reviews on a timely basis--in the context of existing standards--accounting issues for which practice is likely to be divergent or unacceptable, absent further authoritative guidance. IFRIC's goal is similar to that of the FASB's Emerging Issues Task Force (EITF). Guidance issued by IFRIC is issued as "Interpretations."

IOSCO [International Organization of Securities Commissions] Formed to promote high standards of regulation, exchange information, unite in standard-setting efforts and surveillance of international securities transactions, and to promote the integrity of the markets through rigorous application of standards and effective enforcement. A Technical Committee, with member regulators from the world's largest securities markets, is broken down into working committees on issues that include Disclosure & Accounting; an Emerging Markets Committee has similar working groups.

PIOB [Public Interest Oversight Board] Establishment of a PIOB was included in a set of reforms announced by IFAC to oversee IFAC's standard-setting and compliance activities; the 10 members of the PIOB are to be appointed by regulators involved in the reform proposals.

SAC [Standards Advisory Council of the IASB] Advises the IASB on agenda decisions and priorities and gives other advice to IASB and IASCF. SAC members represent a variety of organizations and individuals with an interest in international financial reporting.

Edith Orenstein ([e-mail]) is Manager of Research for Financial Executives Research Foundation (FERF).

contributed by FERF