(The news featured below is a selection from the news covered in Federal Securities Law Reporter, which is distributed to subscribers of Federal Securities Law Reporter.)

SEC Proposes IFRS Acceptance Without GAAP Reconcilation

The SEC approved the issuance of a proposal for public comment that would permit foreign private issuers to prepare their financial statements in accordance with international financial reporting standards as published by the International Accounting Standards Board without reconciliation to U.S. GAAP. Corporation Finance Director John White said the recent roundtable on the use of IFRS showed resounding support from the participants. However, given the limited number of panelists, Mr. White said the comment period will open the discussion to a broader set of views.

The proposal would amend Form 20-F along with other forms and rules and would apply to foreign private issuers that file financial statements prepared in accordance with the English version of IFRS as published by the IASB. The staff completed its first reviews of IFRS filings for the 2005 annual period and wants the results of its reviews to be more readily available to the public. The comments are currently buried along with 10,000 other comments, according to Director White, so the staff hopes by next month to list the IFRS filers by name, along with links to their Forms 20-F and other EDGAR filings. The second round of IFRS filings is due June 30, 2007.

Chief Accountant Conrad Hewitt noted that the reconciliation of IFRS to U.S. GAAP is very expensive, so the elimination of that requirement will result in a significant cost savings. Commissioner Paul Atkins asked when the staff will proceed with the next step of issuing a concept release on permitting domestic issuers to file using IFRS. The staff contemplates that the concept release will be out this summer.

Commissioner Roel Campos asked if the world is going to exist with both U.S. GAAP and IFRS for an indefinite period of time. Mr. Hewitt said it will take time to get to one set of global standards and predicted a five to 10-year time frame. He added that in reviewing the first set of filings containing IFRS, the staff, issuers and auditors all gained valuable experience in a "very useful exercise."

The proposing release will be published in a forthcoming Report.