The Institute of Chartered Accountants of India (ICAI) is hosting the Second Meeting of IASB Emerging Economies Group on Dec 19th & 20th, 2011. The meeting was inaugurated today by Mr. A K Awasthi, Deputy Comptroller & Auditor General of India in the presence of CA. G.Ramaswamy, President, ICAI, CA.Jaydeep N.Shah, Vice-President, ICAI, Mr. Ian Mackintosh, Vice Chairman, IASB, Mr.Wayne Upton, Director of International Activities, IASB and Mr. Prabhakar Kalavacherla, Board Member, IASB. The 2 day meeting would be attended by representatives/participants from countries like Brazil, China, Indonesia, Korea, Malaysia, Russia & South Africa.
The meeting being organized at New Delhi shall dwell upon issues like Effects of changes in Foreign Exchange Rate. Speaking during the inaugural session of the meeting, CA. G.Ramaswamy, President, ICAI said “The volatility in foreign exchange rate is not only concerned with India, rather it is an issue which is common among various economies. Emerging economies feel the adverse effects more than advance economies because their currencies are not reserve currencies and they have to rely more on foreign investments to ensure growth of their economies.”
He further added, “Now days due to the fall in INR value against the foreign currencies like US dollar, the financials of most of the Corporates in India who are also listed abroad are affected as their profits are swept away if the unrealized foreign exchange losses are to be reflected in their profit & loss account.”
On the first day of the meeting, the deliberations took place on foreign currency translation issues. Delegates from around eight countries participated in the discussion with IASB officials to find a common solution as the foreign currency issue is relevant to all the emerging economies. Participants raised their concerns regarding the use of spot rate to translate the monetary liabilities. IASB has been requested that the foreign currency issue should come into their active agenda. It is required to be examined whether the comprehensive review for fundamental revision; or targeted review for improvement on specific issues or a narrow- scope revision for minor, operational issues is required. The members deliberated on the various alternatives to address the issue and requested the IASB to find a common solution to all.
About IASB
The International Accounting Standards Board is an independent, accounting standard-setter based in London, UK, which is committed in developing, a single set of high quality, understandable and enforceable global accounting standards that require transparent and comparable information in general purpose financial statements in public interest.
About Emerging Economies Group (EEG)
The Emerging Economies Group (EEG) was constituted by International Accounting Standards Board (IASB) to help in addressing the financial reporting issues that are of special significance to the economies. The EEG focuses on issues around the application and implementation of IFRSs in emerging economies. In addition, the group may also consider if, and how, the IASB could provide educational guidance at the right level for interested parties in emerging economies—and what the best delivery system for this would be. The possible topics of discussion include common control transactions and issues surrounding foreign currency translation etc.
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