Accountancy is full of politics. In the race to create global standards, everybody from governments to standard-setters to businesses is jockeying for position and nowhere more so than in the UK. We may have probably the most admired and advanced profession in Europe but we risk losing it all by clinging on to traditional values. International standard-setter the IASC and its US counterpart, FASB, are squabbling over the structure of a global standards body and the UK and the European Commission are also making their presence felt. At stake is a fundamental issue facing multinationals: accounting standards determine profits and standard setters, therefore, can determine in which country a company will list. With global stock markets watching closely, this is no internal bureaucratic row. None of this surprises European Commission financial reporting head Karel Van Hulle as he stands at the front line of perhaps the biggest ever battle the profession has faced. Back in the late 1970s, when he first joined the Commission, Van Hulle first sought to clarify a harmonised view of financial reporting with the accounting directives. Some 20 years later, the same arguments rage. That this job should fall to a lawyer is more appropriate than it sounds. In the face of the US challenge, Van Hulle has to represent the 15 different points of view within the Commission. He is well aware of the politics involved. 'The fact we are still doing accounting standard-setting today is the best indication that we got it wrong in the past,' says Van Hulle. 'Standard-setting is no different from any other side of regulation. It is option A rather than option B and so the framework becomes a political document. As a lawyer I have learned we need two or three solutions to every problem.' Van Hulle believes Europe should speak with one voice but politics could easily scupper reform plans from the IASC which were designed to pacify the critics of the previous concept of a dual-board structure. Although he welcomes the idea of a single-board, the suggested voting system which splits rights between full-time and part-time members will not prevent the European vote being fragmented between the member states because they are simply unable to agree. There may be a common currency in continental Europe, but companies and investors alike know cross-border comparisons are impossible given the differing accounting and auditing standards that govern results. The pressure will force the Commission to intervene. Van Hulle - who runs the financial information and company law department within the snappily titled Directorate General XV (Internal Market and Financial Services) - respects the Accounting Standards Board and the maturity of the UK accounting profession. But, he says, differences between company reporting strategy, audit and corporate governance across Europe will have to go. And soon. Within two years, the Commission will publish plans for quality assurance for auditors and seek to create international standards. The aim is to emphasise the importance of the statutory audit and work towards a common code of practice that can be used as a minimum standard. There are also plans to produce a financial reporting document this year asking hard questions, including the possible need for a new European accounting organisation and enforcement mechanism. Of most concern to British institutes will be Van Hulle's view that national organisations will be largely irrelevant within a few years. 'The market is driving this, stimulated by the euro,' he says. 'The UK has a well developed accounting profession but that doesn't mean there are not issues that need to be discussed. It does not make sense that individual countries develop their thinking. It is inefficient.' Everything that corporate entities have held dear will soon change, right down to company board structures as the Commission seeks to knock down barriers to cross-border listings and investment. As early as the autumn, the process of overhauling the central pillars to the Commission's accounting involvement will begin. Written in the late 1970s and early 1980s, member states have expressed interest in starting again. Once again, the same arguments will rage. A LAWYER AMONG ACCOUNTANTS Having trained as a lawyer in Belgium, Karel Van Hulle joined the US Securities and Exchange Commission. He moved to the Belgian Commission on Banking and Finance in 1976, and assisted in drafting most accounting regulations in Belgium. He also contributed to the European Commission's work on company accounting. He joined the Commission in 1984 and now chairs the accounting directives' contact committee, the committee on auditing and the accounting advisory forum. He has represented the EU in the accounting working groups at the UN and represents the Commission within the International Accounting Standards Committee. He was made responsible for company law in 1998.
Resetting the telemetry circuits and associated boards brought the instrument back to operations mode
Fortnite news and updates: Flaw in Fortnite authentication could have helped attackers steal player login credentials
Attackers could have used Fortnite security flaw to buy in-game currency on players' stored credit cards
New photos show cotton seeds sprouting in sealed container - with other plants expected to sprout within days
Sudden increases in availability of sniper rifles on Vikendi