IFRS the international accounting standard setter and watchdog is now under scrutiny. The London based accounting body is being accused by the European politicians of poor governance structures, a lack of transparency and its close links to the accounting industry; which raises the question of independence of the authority. The European Parliament approved a new £50m five-year funding program for the IFRS’s standard setting arm, the International Accounting Standards Board, but the deal came with a series of conditions. The investor made it clear that if these are not met, the funding could be stopped in one year.The standard setter came under scrutiny of the parliament after the Telegraph first highlighted errors in the authority’s filings at  Companies House in February. Taking matters further some politicians are raising concerns about the accounting standards itself, stating they are flawed!
Will the watchdog pass these tests or will this be the slow end of the international accounting standard setter.
A broader question is what would be the future of the reporting in IFRS and the convergence project with US GAAP.