CoordinationofIFRSinEUCESRFinandintheUK.pptVIP

Co-ordination of IFRS in EU(CESR-Fin) and in the UK REPARIS Workshops on Accounting and Audit Regulation, Vienna, Thursday March 15, 2006 FRC Organisational diagram FRC established in 1990, to improve the quality of financial reporting in the UK FRRP established in 1991 to enforce accounting standards FRRP Consensual approach to enforcement Peer review by financial reporting community Single power to go to court to revise defective accounts – never utilised Established as a reactive agency Private organisation – funded by: government, accounting profession, listed companies Communicate directly with company Chairman Panel members –volunteers from across the financial community- lawyers, auditors, finance directors Strong deterrent effect 12 years of operation: over 70 actions resulting in voluntary correction of accounts Role of FRRP reconsidered Post Enron In light of IFRS Regulation 1606/2002 Recital 16 “The Commission intends to liaise with Member States, notably through the Committee of European Securities Regulators (CESR) to develop a common approach to enforcement” Development of FRRP Memorandum of Understanding with Financial Services Authority (FSA) UK Securities Regulator Technical adviser to FSA on CESR sub-committee on enforcement (CESRfin SCE) Welcomed as active participant in CESRfin SCE Able to contribute directly to development of CESR Standards of Financial Information and other guidance Two principles based standards Changes to operations to meet requirements of Standard 1 Increased powers Active selection Extended remit Standard No 2 ‘Co-ordination of Enforcement Activities Enforcement remains national responsibility but need for “road map” that sets out common approach to enforcement across EU Need to: Demonstrate consistent application of IFRS Discuss enforcement decisions Share experiences – sampling approach, compliance methodologies Standard No 2 Four principles Enforcers should take account of previous decisions Includes ex ante, ex p