LONDON – The United States has won a three-year stay on its membership of an accounting oversight panel, keeping alive hopes for a single set of global book-keeping rules that will help investors assess companies.
Leaders from world's top 20 economies (G20) have repeatedly called on the United States and the International Accounting Standards Board (IASB) to align their rules so that investors can compare companies easily.
The United States has yet to say if it will adopt IASB standards, prompting the G20 this month to tell both sides to come up with an alignment plan by December.
The U.S. foot-dragging raised questions about its membership of the IASB Monitoring Board, made up of five global regulators including the U.S. Securities and Exchange Commission, the European Commission and Japan's Financial Services Agency.
The board said on Friday it had toughened up membership criteria to prepare for expansion to include members from emerging markets, and would check in 2016 if members met new conditions.
Membership had hinged on a broad commitment to support global rules but extra conditions have been added such as requiring members to demonstrate the use of IASB standards in a "prominent" way, and to participate in IASB funding.
This puts pressure on the world's biggest capital market to say if it will adopt IASB rules and cough up more money.
The United States has several IASB board seats but only provides 5 percent of funding, though it already allows more than 500 foreign companies listed in the United States to file statements using IASB rules.
The board said a country's commitment to IASB rules would be judged on whether it allowed its companies to use the rules in their reporting.
Accounting industry officials say this puts pressure on the SEC to give domestic listings the option of using IASB rules.
Many big U.S. companies want to use IASB rules but domestic-focused companies are wary of transition costs, while others simply think the U.S. system is superior to IASB.
Makoto Sonoda, a senior official at Japan's FSA said on Monday the Monitoring Board would be expanded, perhaps with up to four regulators from emerging markets.
(Reporting by Huw Jones; Editing by Helen Massy-Beresford)