The changes to the International
Accounting Standards Committee Foundation’s (IASCF) constitution
are too timid and represent a missed opportunity, according to BDO
International chief executive Jeremy Newman.

The IASCF, which oversees the International
Accounting Standards Board (IASB), this month announced changes
that aim to enhance its public accountability, stakeholder
engagement and effectiveness.

Improved governance of the IASCF and IASB is a
major factor of consideration for most jurisdictions that are
considering adopting IFRS, such as Japan, and Newman is concerned
the changes don’t go far enough.

Newman wrote in a blog post that there should
be a more fundamental review that acknowledges the changes that
will be required over the coming years as a number of additional,
significant, jurisdictions adopt IFRS.

“There needs to be a clear signal that there
will be a further overall review of the constitution in the near
term,” Newman said.

The changes represent the second part of the
foundation’s five-yearly constitutional review and include:

• The introduction of a three-yearly
public consultation on the IASB’s technical agenda;

• Emphasis that convergence between
IFRS and US GAAP is a strategy aimed at promoting and facilitating
the adoption of IFRS, not an objective in itself;

• A commitment to a principles-based
approach to standards;

• A requirement for due process that
includes provision for an accelerated due process only in the most
exceptional circumstances and after approval by at least 75 percent
of the trustees;

• The creation of vice-chairs of the
IASC Foundation and the IASB;

• A reduction in the duration of the
second term of IASB members from five to three years to ensure
recent practical experience. The chair and vice-chair would be
exempt from this reduction;

• The IASC Foundation will be
renamed the IFRS Foundation, and the interpretations committee and
advisory council will be known as the IFRS Interpretations
Committee and IFRS Advisory Council. The IASB will retain its
name.

The new IASCF consultation will come into
effect on 1 March.