The Parliamentary Secretary to the Treasurer, Senator Ian Campbell,
today approved funding of an extra $2 million over the next two years to help
Australia meet its goal of adopting international accounting standards.
He said the funds would enable Australia to make a significant
and historic contribution towards the international accounting standards-setting
process. The London-based International Accounting Standards Board (IASB) was
currently working with the Australian Accounting Standards Board (AASB) and
other national standard-setters to develop a single set of high quality accounting
standards for world-wide use.
Senator Campbell said the Chairman of the Financial Reporting
Council, Mr Jeff Lucy, was in discussions with Australia's top 100 companies
to make a similar financial contribution.
"This is a major step towards our objective of having Australia
adopt one international set of standards which I would like to see in place
across all major financial centres by no later than 2005," Senator Campbell
told delegates at a two-day conference on auditing and accounting standards
in Sydney today.
"Adoption of IASB standards will bring significant benefits
such as lower capital and compliance costs and easy comparison of financial
accounts of Australian and foreign-based companies. Audit certificates attached
to financial statements of Australian companies would be signed off as IAS-consistent,
improving the opportunities of Australian companies to attract capital and issue
debt instruments, particularly from overseas.
"Key stakeholders agree this is the course to take. Having
one set of standards will be a considerable improvement on the existing cumbersome
procedure whereby Australian standards are periodically updated to reflect IAS."
Senator Campbell said Australia was already well advanced in harmonising
its accounting standards with IASB. He said that the CLERP reforms had made
standard setting more inclusive and internationally focussed.
He said approval of the expenditure would allow the Securities
Exchanges Guarantee Corporation Limited to transfer the $2 million from excess
money in the National Guarantee Fund to the Financial Industry Development Account
of the Australian Stock Exchange.
The funding would be in addition to the $2.8 million currently
contributed annually to the work of the AASB by other stakeholders in the standard-setting
process - Federal, State and Territory Governments, the three accounting bodies
and the ASX.
Senator Campbell said Australia was well represented on the IASB,
its oversight and subsidiary bodies and at senior staff levels. The $2 million
contribution would supplement Australia's intellectual contribution to the cooperative
effort.
He congratulated the Managing Director of the ASX, Mr Richard
Humphry, and Mr Lucy for their continued commitment to the improvement of corporate
disclosure, financial reporting quality and the achievement of globally accepted
accounting standards.
Senator Campbell also told the conference that corporate failures
in Australia and the United States had put the accounting profession under unprecedented
scrutiny. There was also a welcome focus on auditor independence issues and
examination of the responsibilities of boards, senior management, audit committees,
analysts, ratings agencies and financial institutions.
"Corporate failures nearly always reflect poor business judgements rather than poor accounting and auditing practices," he said.
"Not everything laid at the door of the profession properly
belongs there, but professional reputation is everything and even problems of
perception need to be addressed if the profession is to enjoy the full confidence
it needs to do its job properly.
"For its part, the Government is committed to ensuring Australia
has an effective regulatory and disclosure framework that is at the forefront
of defining world's best practice. This includes strong auditing and accounting
standards and a robust supporting framework.
"The Government will ensure that the structures and incentives
are in place for a properly informed market, but it will not impose additional
legislative requirements unless there is a clear failure of market mechanisms
to produce appropriate outcomes."
PERTH
12 June 2002
Contact: Wayne Grant, Senator Campbell's Office - 08 9421 1755
or 0407 845280
http://parlsec.treasurer.gov.au