Europe Reforms Audits, Urges U.S. Cooperation
AccountingWEB's sister site  in the U.K. said the reforms were generally welcomed by European accounting firms and are seen as a way to harmonize audit regulations among the 15 member countries. Press accounts indicate European officials are also trying to encourage harmonization with regulations for U.S. capital markets.
Prospects For U.S.-European Cooperation
Reuters said  the EU challenged the U.S. to tear down "massive barriers" to trading European securities in America and help build an integrated transatlantic securities market. EU Internal Market Commissioner Frits Bolkestein said he envisions "an integrated transatlantic securities market of 700 million people that would enable U.S. market participants such as broker-dealers, investment firms, banks, (to) have direct access to European securities markets."
To help make his vision a reality, Commissioner Bolkestein said he would urge U.S. Securities and Exchange Commission (SEC) Chairman Harvey Pitt to recognize International Accounting Standards for European firms registered with the SEC. Next week, he plans to ask Chairman Pitt to drop the requirement for a reconciliation with U.S. generally accepted accounting principles.
In response, the SEC has said it will continue to guard against any "regulatory arbitrage" that would allow companies to pick the softest accounting rules. However, SEC spokeswoman Christi Harlan told Reuters: "Chairman Pitt is interested in easing the restrictions on the access to U.S. capital by foreign markets. He has directed the SEC staff to craft a proposal that will achieve the goals of more seamless global market access while minimizing the possibility of regulatory arbitrage with U.S. exchange requirements."