Relations with the US
Initially the IASB arranged to have one joint meeting a year with the FASB, but in September 2002 it signed the ‘Norwalk Agreement’ with the FASB. This set out a programme of convergence which involved both work on joint projects and removal of differences where feasible. Not least, out of this agreement came a decision to update their respective conceptual frameworks and to converge on a common framework. The number of joint meetings was increased to two a year, one in London and the other in Norwalk, Connecticut. Ever since then, the two Boards have worked closely together.
in September 2002 [ the IASB] signed the ‘Norwalk Agreement’ with the FASB
This cooperation was extended by a 2006 Memorandum of Understanding. The European Commission had been talking with the SEC about removing the reconciliation that the SEC required from foreign issuers listed in the US. The Commission was talking about introducing such a requirement in Europe for any company not using IFRS. The two institutions agreed a road map for doing away with the reconciliation requirement and recognizing IFRS and US GAAP as equivalent (the holy grail long sought by the IASC). The SEC then sat down with the FASB and IASB to discuss what progress towards convergence it wanted to see in place before it would do this. The Memorandum of Understanding set out a series of milestones to be achieved by 2008.
The standard-setters duly worked on this, albeit not as successfully in terms of the speed ...