It’s dated May 2019, but by its nature immediately feels like a relic from a bygone age, one in which a US adoption of IFRS seemed like something more than a remote fantasy. Scanning the piece, I actually found it quite enjoyable to step into a time machine and travel back to a time when it was still worth setting out such basics, for instance:
- (Advantage #1) It would create a single set of accounting standards around the world.
Instead of using multiple accounting standards based on the preference of each country where an organization does business, adopting the International Financial Reporting Standards would enable agencies from different segments of the globe to apply the same standards in every transaction. The advantage to find here is an increase in transparency, which would then allow for more accessible cross-border investments. It would decrease the cost of capital while providing higher liquidity during each transaction.
It certainly seems true that the cost of capital has largely decreased during the age of IFRS, although that’s more a matter of correlation than causation, and not unambiguously a good thing. As a recent commentary on Bloomberg Businessweek put it:
- (Current conditions have) sent investors looking under every available rock for more return—even if it means taking more risk. The fear is this could lead to the formation of bubbles and eventually destabilize the financial system. “Institutional investors are out there in the great truffle hunt for yield,” says Walsh, at Guggenheim. “This is particularly true of large institutions, like banks and insurance companies and pension funds. These firms are searching for yield and potentially taking on unintended risk because that is what they need to do.”
So some might argue that a few old-fashioned slow-down mechanisms, such as those presented by incompatible, reconciliation-necessary accounting standards, wouldn’t be all bad. Anyway, despite the May 2019 dateline, it eventually becomes clear that the article has been dusted off from a while ago. Take the following passage:
- Mary Jo White, the Chairman of the SEC, recently said that promoting a standard set of global accounting rules should become of the top priorities of her agency.
White stepped down as SEC Chair at the end of President Obama’s term – not that one can blame anyone for trying to pretend the Obama era is still in progress. The website in question is Connectusfund.org, which carries the stated goal of “publish(ing) compelling content that addresses some of the biggest issues the world faces.” On the day I first visited the site, the most recent post was titled “Luke 21:25 Meaning of And There Shall be Signs in the Sun, Moon and Stars” This addresses the following Biblical passage:
- “There will be signs in the sun, moon, and stars. On the earth, nations will be in anguish and perplexity at the roaring and tossing of the sea.”
I’m no Biblical scholar, but the quality of the commentary seemed a bit pedestrian to me:
- What could Jesus mean by this phrase “signs in the sun?” Could the phrase be figurative or literally? That is the question. The answer is that it is both. According to Jesus, signs coming from the sun means changes. There will be changes that are evident to the people. The sun is what people can see and if the sun gives a sign, everyone will see it. The kind of change that Jesus was saying here could represent different things. These include doctrines changing and moral standards being compromised.
- On the literal part of the phrase, the sun will indeed give a sign as it will be turned to darkness. The same thing goes for the moon and the stars. All will be changed.
Actually, it’s so pedestrian that I wondered if it wasn’t generated at least in part by a computer program. There’s a lot more like that on ConnectUs, such as 2 Corinthians 12:9 Meaning of My Grace is Sufficient for You, and 11 Good Prayers for Finding a Husband (a rather submissive list of prayers by the way, to my way of thinking). Not my usual kind of bag, to be honest, but I rather enjoyed seeing the pros and cons of IFRS being pondered in such spiritually-charged company, and allowed myself to hope that the proximity might only boost the cause.
The pros and cons article concludes: “We are all seeking ways to reduce barriers to global expansion, which is why switching to these standards is one idea that receives robust consideration.” But this too already seems out of step with the age of trade wars, Brexit and US foreign policy derangement. Oh well, things may yet evolve further. As I gleaned elsewhere from the site, “The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to poverty…”
The opinions expressed are solely those of the author (who is, most likely, not a computer program)