The IFRS Foundation has made a series of
recommendations in a strategy review report, including methods to
enforce its new strategy.

Released today, the strategy review sets out
recommendations in four areas – the IFRS Foundation’s mission,
governance, the standard-setting process and financing, including
operational aspects of due process and standard-setting
oversight.

Highlights of the recommendations include:

  • The Foundation should remain committed to the
    long-term goal of the global adoption, in their entirety and
    without modification, of IFRSs as developed by the IASB;
  • The current primary focus of the Foundation
    and the IASB should remain on developing standards for private
    sector entities i.e. both publicly traded entities and SMEs;
  • The Monitoring Board, the Foundation and the
    IASB should enhance interaction and procedures to reinforce the
    principles of transparency, public accountability and independence.
    In doing so, the roles and responsibilities of each element of the
    organisation’s governance should be clearly defined;
  • The framework for the trustees in their
    oversight of the IASB’s due process should be clarified. The
    trustees’ Due Process Oversight Committee (TDPOC) should review and
    discuss due process compliance regularly throughout the
    standard-setting process and at the end of the process before a
    standard is finalised. The TDPOC should report regularly on these
    activities to the Trustees and in its annual report; and
  • The existing base of financing should be
    expanded to enable the Foundation to serve the global community
    better and fulfil the new strategy. Specifically, funding should be
    proposed by the trustees to be on a long-term basis at least three
    to five years, be publicly sponsored, be flexible to permit the use
    of differing mechanisms and to adjust to budgetary needs, be shared
    among jurisdictions on the basis of an agreed formula consistent
    with the principle of proportionality and provide sufficient
    organisational accountability.

The deadline to comment on the review is 25
July.

Working together

The trustees and the Monitoring Board have
reaffirmed their commitment to working together more closely to
ensure their respective reviews provide one co-ordinated governance
and strategy package.

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The Monitoring Board is currently conducting a
Governance Review looking at its composition, respective
responsibilities and its role as well as the trustees and IASB.

“The Monitoring Board will develop and publish
an action plan for implementation of its governance review with a
desire to present, along with the trustees, an integrated package
of governance improvements,” IFRS Foundation Monitoring Board
acting chair Masamichi Kono said.

IFRS Foundation Trustees co-chairs Aki
Fujinuma and Robert Glauber added:

“The trustees initiated their review at the
urging of our stakeholders in order to prepare for the Foundation’s
second decade. The trustees are strongly committed to working with
the Monitoring Board to ensure that the outcome of our respective
reviews provide one co-ordinated package.”

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