Investors urge EU to rethink rules

News Article - 24 May 2012
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UK investors are calling on the European Commission (EC) to reconsider a US accounting standard that many believe will lead to confusion.

A number of firms are recommending that EC officials stop endorsing rules that will give business leaders the ability to report results using criteria of their own choosing.

It is believed that the draft IFRS 8 standard could make it difficult to ascertain the true condition of firms, contributing to wider confusion among international investors and a lack of confidence overall.

In particular, concerns have arisen that the standard could be exploited by executives to change results, disguise poor performance or mask dubious strategic decisions.

The group of investors who are calling on the EC to reconsider its endorsement of IFRS 8 includes the Investment Management Association, according to the Financial Times.

Concerns that were previously voiced to the International Accounting Standards are reported to have been rebuffed.

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