I’m gobsmacked. Richard Murphy refers to an International Accounting Standards Board and the Federal Accounting Standards Board that attempts to shift the ‘stewardship’ goalposts as they relate to reporting:
[ ]…the converged framework should specify only one objective of financial reporting, that of resource allocation decision-usefulness.
Fortunately, European standards setters see things differently, seeing stewardship in familiar terms. Richard uses this as an argument to reinforce his view that IFRS8 should be tossed out. While that is a laudable objective, I fear Richard has missed the point.
The very fact that US regulators are seeking to redefine a fundamental tenet of management accountability and audit responsibility appears (to me) as yet another attempt to undermine the regulatory framework. Think about this. If stewardship only refers to reporting and not the protection of assets on behalf of investors then this is management without responsibility. That cannot be right.
Technorati Tags: accountability, IFRS
