Another week, another step toward global accounting standards.
The latest development comes from the Financial Accounting Standards Board, which has issued two new statements that, according to the FASB, “will improve, simplify and converge internationally the accounting for business combinations and the reporting of non-controlling interests in consolidated financial statements.” The statements in question are No. 141 (revised 2007), Business Combinations, and No. 160, Noncontrolling Interests in Consolidated Financial Statements.
FASB’s announcement comes on the heels of an SEC announcement that foreign private issuers in the United States will not have to reconcile their financial statements with U.S. generally accepted accounting principles, provided that the statements are prepared using international financial reporting standards from the International Accounting Standards Board.
Still, CFO.com’s Marie Leone says corporations will struggle to keep up with the new rules, which “represent a major departure from the historical cost accounting that many companies use now,” Leone writes. Read more of Leone’s analysis here.