[JURIST] The US Securities and Exchange Commission (SEC) [official website] Wednesday moved to ease accounting procedures [meeting agenda; recorded video, (00:41:15) WMV] required for foreign companies trading on US exchanges. The SEC commissioners voted 5-0 to amend federal regulations to accept financial statements prepared in accordance with International Financial Reporting Standards (IFRS) [Wikipedia backgrounder], as published by the International Accounting Standards Board [official website], rather than in accordance with the Generally Accepted Accounting Principles (GAAP) [official backgrounder] used in the US. Foreign companies have argued that reconciling the two standards is time-consuming and expensive, and have pushed for US acceptance of the internationally recognized standards.
Some analysts believe that by accepting the IFRS, it will be more difficult for investors to compare the foreign companies with domestic companies using the GAAP system. Formal adoption of the change will come after a public comment period, and would apply to 2008 reports. AP has more.