Deloitte calls for international accountancy

By Mark Reynolds

Accounting standards in Apec countries are likely to be more strictly scrutinised as the world's main accounting firms look to develop some global conventions for business.

But a move towards totally common international accounting rules appears to be a long way off.

A call for universal standards is being championed by accounting firm Deloitte Touche Tohmatsu.

"Inconsistent financial reporting and lack of transparency throughout the region are limiting business development within the Asian region," said Bob Campbell, regional managing partner for Deloitte in Asia Pacific.

"There is now an urgent need to set international standards for financial reporting and create a community of interested parties to enforce them."

But Mr Campbell conceded it would take a while for some countries to accept common rules.

"It is very doubtful that we can bring about this change in a short period of time.

"There are many cultural differences that make it difficult for some people to see the need and the way to change."

But increasing ties between companies internationally made it imperative that uniform accounting was introduced, he said.

At present, most companies are obliged only to comply with the regulations of their own countries. But international concerns, especially United States-based companies, are increasingly putting accounting tags on their accounts if some of their business is conducted in a jurisdiction outside of North America.

"We are not saying accounting standards are worse in other areas, just different in some countries," Mr Campbell said.

He said many companies in Asia were already being evaluated by "Western" investment models, but reporting standards were inconsistent and therefore the robustness of the evaluations had to be questioned.

He said cultural differences, for example where some Asian societies were hesitant to question information put before them, were the kind of obstacles that had to be overcome.

"Everyone who is involved in the flow of capital across borders should be involved in addressing this problem. No region or country should feel that they have not been part of developing a solution, and any agreed models must be global, and take into account both the public and private sector.

"Only when this is agreed and established will trade and investment within the Asia region reach its full potential."