As reported in Inside Track 53, the US Securities and Exchange Commission last year consulted on a proposal to allow foreign companies to submit financial statements using International Financial Reporting Standards (IFRSs) as issued by the IASB without having to include a reconciliation to US Generally Accepted Accounting Principles (GAAP). On 15 November 2007, the SEC voted to accept this proposal with immediate effect for financial statements for financial years ending after that date. This is a landmark decision which represents an important step towards the development of a single, high quality language for financial reporting that is accepted throughout the world's capital markets. The SEC's rule is available at http://www.sec.gov/rules/final/2007/33-8879.pdf.

In the meantime, the SEC is considering the responses to its August 2007 Concept Release on whether it should allow US issuers to file financial statements that comply with IFRS instead of US GAAP.

The SEC has also set up an Advisory Committee on Improvements to Financial Reporting. The Committee's objective is to examine the US financial reporting system to identify ways to improve it. The Committee has produced a 'Draft Decision Memo' setting out its views to date, which can be accessed from the SEC's website. The ASB is monitoring the work of the Committee.