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March 13, 2014

European Parliament approves funding for IFRS

The plenary of the European Parliament (EP) has voted in favour of the funding programme which will support financially the activity of the International Financial Reporting Standards (IFRS) Foundation.

The EP approved today in Strasbourg the so-called European Union (EU) programme in the field of financial reporting and auditing 2014-2020, which co-funds also the activity of the European Financial Reporting Advisory Group (EFRAG) and the Public Interest Oversight Board (PIOB).

The financial aid for the three organisations could amount to €43.2m ($59.9m), of which the IFRS Foundation would perceive €5.3m annually for the period 2014 to 2020, €31.6m in total.

The PIOB would receive €2.2m during the same period, whereas the sum allocated for EFRAG would be €9.3m but only until 2016.The objective of this programme, as stated in draft regulation dated from 17 February, is to improve the internal market by supporting the development of international financial reporting and auditing standards.

The Association of Chartered Certified Accountants (ACCA) said it welcomed the endorsement by the EP of the proposed regulation underpinning the programme.

ACCA head of corporate reporting Richard Martin said the regulation allows not only for the independence of the International Accounting Standards Boards (IASB), but also for its scrutiny and evaluation by EU institutions in the six year period.

"Appropriate funding from the EU is essential for the continued development of the standards. We are also hoping for a satisfactory outcome there which will give the EU an enhanced endorsement advisory system and foster European influence in the development of IFRS," Martin said.

The endorsement of the funding programme follows the recommendations of Philippe Maystadt, special advisor to the commissioner for internal market and services Michel Barnier, ACCA said.

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