AIMS
The Accounting Standards Board contributes to the achievement of the Financial Reporting Council's fundamental aim of supporting investor, market and public confidence in the financial and governance stewardship of listed and other entities by pursuing its own aims of establishing and improving standards of financial accounting and reporting, for the benefit of users, preparers, and auditors of financial information.
OBJECTIVES
The Board intends to achieve its aims by:
- Developing principles to guide it in establishing standards and to provide a framework within which others can exercise judgement in resolving accounting issues.
- Issuing new accounting standards, or amending existing ones, in response to evolving business practices, new economic developments and deficiencies being identified in current practice.
- Addressing urgent issues promptly.
- Working with the International Accounting Standards Board (IASB), with national standards-setters and relevant European Union (EU) institutions to encourage high quality in the IASB's standards and their adoption in the EU.
OPERATING GUIDELINES
In carrying out its work the Board will
- Be objective and ensure that the information resulting from the application of accounting standards faithfully represents the underlying commercial activity. Such information should be neutral in the sense that it is free from any form of bias intended to influence users in a particular direction and should not be designed to favour any group of users or preparers.
- Ensure that accounting standards are clearly expressed and supported by a reasoned analysis of the issues.
- Determine what should be incorporated in accounting standards based on research, public consultation and careful deliberation about the usefulness of the resulting information.
- Ensure that there is consistency both from one accounting standard to another and between accounting standards and company law.
- Issue accounting standards only when the expected benefits exceed the perceived costs. The Board recognises that reliable cost/benefit calculations are seldom possible. However, it will always assess the need for standards in terms of the significance and extent of the problem being addressed and will choose the standard which appears to be most effective in cost/benefit terms.
- Take account of the desire of the financial community for evolutionary rather than revolutionary change in the reporting process where this is consistent with the objectives outlined above.
- Follow best practice in its own governance and processes, deploy resources effectively and liaise with the Council's other Boards to promote and benefit from operating synergies wherever possible.
ASB
30 July 2003
