U.S. President George Bush has called for accounting standards to be responsive to the needs of investors. But results of a survey by McKinsey & Company announced the day before the President's ground-breaking speech to Wall Street show this may be easier said than done.

McKinsey surveyed more than 200 institutional investors in 31 countries. Participants included a wide range of institutions, such as pension funds, mutuals, money managers, private equity firms and banks. Collectively, these investors are responsible for $2 trillion of assets under management.

The survey found overwhelming support for a single unified global accounting standard. Altogether 90% of the respondents favor this approach. But the survey also found that investors are split down the middle on the preferred standard: U.S. generally accepted accounting principles (GAAP) or International Accounting Standards (IAS).

The geographic breakdown is significant:

• In Western Europe, 78% favor IAS while 22% favor GAAP.
• In Eastern Europe and Africa, 76% favor IAS while 24% favor GAAP.
• In Asia, 65% favor IAS while 35% favor GAAP.
• In Latin America, 41% favor IAS while 59% favor GAAP.
• In North America, 24% favor IAS while 76% favor GAAP.

The survey also found that almost all investors support expensing of stock options, with investors in North America constituting the most significant minority (67% favor expensing, while 33% are opposed).

With regard to priorities for policy-makers, the results seem to be clearly aligned with the priorities reflected in the President's comprehensive reform agenda. Investors said the top three priorities were strengthening shareholder rights, improving accounting standards and more effective disclosures.

Download the press release and a presentation of survey results.

-Rosemary Schlank