EU seeks to increase influence on global accounting rulebook

City A.M. Reporter
THE EU is seeking to increase its influence over global accounting standards by beefing up the agency that scrutinises new rules and in certain cases tweaking how they are applied in the bloc.

The book-keeping standards, the bedrock of markets, are written by the International Accounting Standards Board (IASB). They apply in over 100 countries, including the EU, but not the United States.

Accounting rules have become highly politicised after policymakers around the world blamed them for exacerbating the 2007-09 financial crisis.

Michel Barnier, commissioner for financial services, asked former European Investment Bank chief Philippe Maystadt to recommend how the bloc can streamline advice and endorsement.

In a report published yesterday, Maystadt recommended beefing up the agency financially through compulsory levies on listed companies, and elevating its board to look at the political and economic as well as technical aspects of rules.

In a challenge to IASB authority, Maystadt also recommended changing how the commission endorses a standard, broadening it out from a simple yes or no to include the ability for so-called carve ins – or local tweaks to the rules – but only to improve the “public good”.

“I am particularly keen that Mr Maystadt’s recommendations should be implemented swiftly,” Barnier said in a statement.

He will present them to EU finance ministers on Friday.