Australia's adoption of international accounting standards in 2005 would benefit business and investors, the Parliamentary Secretary to the Treasurer, Senator Ian Campbell, said at a dinner held in Melbourne last night to welcome the chairman of the International Accounting Standards Board, Sir David Tweedie, to Australia.
Senator Campbell said that in a globalised economy with growing international capital movements, a single set of high quality accounting standards would reduce capital costs and make it easier for investors to compare companies in the same industry in different countries.
He said the benefits of full adoption of the standards far outweighed any difficulties associated with the transition.
"There has been some questioning of the timing of our adoption of international standards, however not to adopt by 2005 would put Australia out of step with the European Union as well as the United States - an outcome we could not contemplate," he said.
Senator Campbell said he recognised the tight deadline "will pose some challenges for business, the profession, our standard-setter and its oversight body, the Financial Reporting Council.
"But the Government has every confidence that under the guidance of Jeff Lucy (chairman of the FRC) and Keith Alfredson (chairman of the Australian Accounting Standards Board) -- and with the strong support of the international board, the business community, the profession and users of financial statements - the transition will be smooth."
Sir David is in Australia to discuss adoption of international standards with the FRC and AASB.
Senator Campbell told guests at the dinner, hosted by the Australian Stock Exchange, Business Council of Australia, Australian Insititute of Company Directors and the FRC, that the FRC and AASB would be responsible for developing a strategy to meet the 2005 deadline and for ensuring stakeholders were kept informed from the outset.
"Judgements will have to be made at the technical level at various stages of the transition, but the Government fully endorses the approach that the highest common denominator must prevail," he said. "For example, Australian standards that do not have IASB counterparts will remain on the books until an international standard is adopted."
Sir David told Senator Campbell at a meeting earlier that Australia's leadership in promoting the benefits of international standards was widely recognised in the UK, Europe and United States.
PERTH
7 August 2002
Further information: Wayne Grant 08 9421 1755 or 0407 845 280