On 16 March the ASB published an Exposure Draft of its Policy Statement 'Accounting Standard-setting in a Changing Environment: The Role of the Accounting Standards Board'. The Exposure Draft sets out the ASB's views on its future role.

With the advent of 2005, the environment for accounting standardsetting has changed dramatically. The draft Policy Statement argues that the most significant future role of the ASB will be in contributing to the development, with the International Accounting Standards Board (IASB) and others, of a set of high quality global accounting standards. The ASB has the capacity as an established national standard-setter to be a valuable source of accounting thought and insight for the IASB and an influential voice in debates on new accounting standards.

The ASB believes that its fundamental aim remains appropriate:

To contribute to the establishment and improvement of standards of financial accounting and reporting for the benefit of users, preparers and auditors of financial information.

Supporting this aim the ASB has identified its major activities as:

1. contributing to the development and implementation of International Financial Reporting Standards (IFRS);
   
   
2. influencing European Union policy on accounting standards, including the endorsement of IFRS;
   
   
3. achieving convergence of UK accounting standards with IFRS;
   
   
4. improving other aspects of UK accounting standards;
   
   
5. improving communication between companies and investors, including developing and implementing standards for the OFR.

Effective communication goes to the heart of the ASB's policy; including communication with IASB, other national standard-setters, EFRAG and constituents.

In relation to influencing the IASB the ED suggests the ASB has a role as the natural focus for a debate on accounting issues in the UK. A twoway dialogue with UK constituents will allow the ASB to formulate its own views on IASB proposals, but also reflect on the views and concerns of UK constituents. The ASB can then provide its comments to the IASB in a constructive manner that also demonstrates an understanding of IASB thinking, as a result of its continual contact with IASB at various levels.

The ASB also provides a focus for a UK voice in Europe. For example the ASB is actively involved in EFRAG's research-type projects and will work with other European standard-setters to share views and support the development of these projects.

The Board will work towards the convergence of UK accounting standards and IFRS, with a current aim of bringing UK standards fully into line within a period of 3-4 years. This process has already started and the ASB's Technical Plan (also published on 16 March) sets out in detail the publications expected for the remainder of 2005 and the strategy the ASB plans to adopt in relation to the introduction of other UK IFRS-based accounting standards. However, the ASB will not commit itself, as a matter of policy, to converging with all IFRS, although any exceptions are expected to be extremely rare.

In setting UK IFRS-based accounting standards the ASB may vary the requirements from those in the equivalent IFRS, where it is justifiable to do so. This will generally involve making a standard more appropriate for the entities that have to apply it, or giving a later implementation date. However, this will not result in multiple sets of accounting standards for different classes of entities: the standards will all be based on the same core set of principles: only in relatively minor respects (such as disclosure) will the requirements differ.

The ASB has also set out its thoughts on the future of its SORP regime, how the process of dealing with urgent issues might change and the development of reporting standards for other area of corporate reporting complementary to financial reporting.

Comments on the draft Policy Statement are requested by 15 September.

Comments are also welcome (at any time) on the Technical Plan, which will be regularly updated. It includes 'Expected publications in 2005' which is reproduced on this page. The full Technical Plan is available from the ASB's website at www.frc.org.uk/asb/technical/techplan.cfm.

Separately, the IASB is consulting on a draft Memorandum of Understanding on the role of national standard-setters and their future relationship with the IASB. Comments are sought by 29 July. The draft MoU is available on the IASB website at www.iasb.org