Technical committee profile: Global Oversight Committee (GOC).

The reason FEI changed its name in 2000--from Financial Executives Institute to Financial Executives International--was to better prepare the association to respond to the increasing globalization of financial reporting standards, as well as the internationalization of business operations. Hence, the Global Oversight Committee (GOC) was formed by FEI's Executive Committee to drive efforts to make that "i" truly mean "international" by reaching out to senior finance organizations and international regulatory standard-setting bodies.

"Visibility for FEI is the main thing that that GOC is about," says the committee's current chair, David Morris, senior vice president of JPMorgan Chase Bank in New York. Morris has previously served as FEI's representative to the International Association of Financial Executives Institutes (IAFEI), which he had chaired. As such, he has extensive knowledge and experience in the workings of international finance networks and groups. Raising the stature of FEI around the world, Morris explains, is key so that as changes are occurring, "the organizations originating accounting or auditing standard-setting will come to us for input."

Whose interests does the GOC serve? "All members," Morris argues. "Obviously, a number of FEI members are with companies that are currently impacted by international accounting and auditing standards." However, as convergence continues, all U.S. companies, no matter what size, will be impacted by the trickle-down effects of conveying accounting and auditing standards. For example, he explains, "European Union (EU) businesses of all sizes all are adopting International Financial Reporting Standards (IFRS) of the International Accounting Standards Board (IASB). So, small businesses in Europe are facing many of the convergence issues that someday those in the U.S. will also face."

As noted on FEI's Web site, the GOC is charged "to create a global forum of financial executives, initially from both sides of the Atlantic, willing to share best business practices, to engage in a business network, to follow a common code of ethics and to play an advocacy role in front of regulatory bodies." The committee's mission is three-fold: to "develop strategy for international growth; identify products and services to support globalization of FEI; and determine governance and organizational structure for a globalized FEI." The committee's FEI liaison is Grace Hinchman, Senior Vice President, Public Affairs, Technical Committees and GOC. Currently, the GOC is comprised of approximately 20 members, who include former FEI chairs and others representing a wide variety of member companies. FEI members interested in participating on the GOC should contact Grace Hinchman at [e-mail].

The committee's work involves "two tracks," explains Hinchman. One is to provide opportunities for coordinating and collaborating with other international CFO policy groups, such as the European Roundtable--which is comparable to the U.S. Business Roundtable (BRT)--to promote strategic direction in global policy. Another is the Group of 100, which represents British CFOs before the European Commission (EC).

The second track, Hinchman continues, involves building "one-on-one relationships with other country FEIs," like those FEI has done with FEI Australia and FEI Mexico. Since 2002, FEI has signed Memorandums of Understanding (MOUs) with both FEI Australia and Mexico for a variety of content-sharing. The GOC is pursuing opportunities to craft MOUs with South Korea and France.

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Morris concurs with "both tracks," and is seeking a "major project to work on with the Group of 100 or European Roundtable." Such an opportunity will likely arise from the ongoing convergence project between the IASB and the U.S. Financial Accounting Standards Board (FASB).

A recent example of where the GOC was successful due to the "foundation of relationships that we have built," Morris notes, related to a possible recision of APB 23, a tax and accounting issue that was part of the IASB and FASB short-term convergence project. The IASB was proposing to adopt a non-U.S. tax and accounting standard treatment for unremitted earnings, which, according to Morris, would have been "a disaster for U.S. companies." He says, "We made contact with the European Roundtable, ex-plaining why this was a problem for U.S. companies (because our tax and accounting structures are fundamentally different from the European structures), and asked for its assistance in lobbying to have this issue removed from the IASB short-term convergence project." He says this collaboration has proven successful, as APB 23 recision is no longer a part of the IASB/FASB short-term convergence project.

In these "spot actions," Hinchman reiterates, "GOC has been effective at building the foundations of relationships so that, when necessary, we can work with them and collaborate on other international finance policy issues." The GOC is interested in pursuing more such projects, says Hinchman, and "when the opportunity arises, we will be ready, building on relationships we've already established."

Going forward, Morris would like to "sign up a few more countries" and do a few more "one-off joint conferences," such as the bilateral conference in Paris last May with DFCG, the French FEI Institute, and the upcoming joint conference with the Mexican FEI Institute in March in New York. Also, Morris wants to build on the GOC's efforts on both accounting and auditing standards by continuing FEI's global lobbying efforts. He notes that FEI President and CEO Colleen Cunningham serves on the International Accounting Standards Council (IASC) of the IASB and he serves on the Consultative Advisory Group of the International Auditing and Assurance Standards Board (IAASB).