Will the Scott Brown Election to the Senate Impact the Advent of IFRS?
By Theresa Hickman-Oracle on Jan 25, 2010
The other day I ran into our resident accounting expert, Seamus Moran. I mentioned that I still have not seen any word about the SEC finalizing the roadmap for IFRS adoption.
He mentioned that there would probably be even more delays now that the political landscape has changed with the Republican Senator-elect Scott Brown joining the Senate.
I responded, "Really? I thought that would only affect the very heated debate about health care reform since the Democrats lost their filibuster-proof 60 seat majority."
Seamus said that given the rethinking of Representatives' and Senators' positions following Mr. Brown's election, it's possible that any "soundings" that the chair of the SEC, Ms. Shapiro, has previously done with her supervisors will need to be revisited. It's likely that both committees are more concerned with health care legislative activity and Mr. Obama's banking proposals of January 20 than arcane accounting proposals. However, the impact of those banking proposals on the stock market on January 21 and January 22 might make the committee members slightly wary of endorsing anything without a careful study.
Seamus then gave me a bit of a history lesson. The SEC is a government agency that is funded by the President. The SEC is supervised by Congress' House Committee on Financial Services, chaired by Barney Frank, through the Capital Markets, Insurance and Government Sponsored Enterprises subcommittee, chaired by Representative Paul E. Kanjorski. The relevant Senate committee is the subcommittee on Securities, Insurance and Investment, chaired by Jack Reed, and reporting to Christopher Dodd's Banking, Housing & Urban Affairs committee.
U.S. laws drive accounting standards and regulations. Now that the Democrats lost the 60 votes control in the Senate, they can no longer pass legislation without opposition from Republicans. Republicans may not favor a rapid adoption of IFRS.
Personally, I hope they revisit the Sarbanes-Oxley Act of 2002. Sure, it has helped restore public confidence in the nation's capital markets, but I feel it is putting a huge financial burden on U.S. companies and taking away our competitive edge.