International Financial Reporting Standards The views expressed in this presentation are those of the presenter, not necessarily those of the IASC Foundation or the IASB IASC Foundation IASB and Convergence Paul Cherry Chairman, Standards Advisory Council November IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | Chairman, Standards Advisory Council

Momentum for IFRS Continues 100+ countries already –Includes EU, Australia Several countries in transition, including –Canada, China, Japan, Korea, Mexico Focus in most countries is on listed companies Approach varies for private companies

Global Market Trends (2007)* Global Fortune 500 –US GAAP42% –IFRS32% –Japan 9% [switching to IFRS] –Canada 3% [switching to IFRS] –Other14% * Centre for Audit Quality 2008 IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | 3

Global Market Trends ( )* Growth of listed companies on stock exchanges –Korea163% –India 53% –Singapore53% –China27% –UK10% –US( 1)% * Center for Audit Quality 2008 IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | 4

Global Market trends ( )* % of Global Market Capitalization on Exchanges China4%9% UK8%6% US48%35% * Center for Audit Quality 2008 IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | 5

Canada’s Changeover to IFRSs [1/2] “Publicly accountable” –IFRSs; or –US GAAP [ SEC registrants only] Private enterprises –IFRSs; or –Canadian Private Enterprise GAAP [not IFRS SMEs] Non-for-profits: undecided Government business enterprises: IFRSs

Canada’s Changeover to IFRS [2/2] Mandatory in 2011 –Interim and annual reports –Early adoption permitted, eg Brookfield No carve-outs or add-ons Unreserved statement of compliance with IFRSs –Notes to the financial statements –Auditors’ reports

Status of Convergence Financial crisis has put IASB and FASB under enormous political pressure –Has not slowed momentum for global standards (SEC) IASB/FASB partnership strained but strong –Commitment to 2011 MOU remains –Enhanced work arrangements agreed in Oct/09 All major new projects will be joint IASB/ FASB where possible

What About the US? SEC proposed roadmap –SEC will “redouble its efforts” [Kroeker] –Next milestone deadline is Dec 21/09 Paul Volcker: –SEC should heed G20 call for global standards David Tweedie: US needs to commit by 2011

IFRS Already in Use in US (2007)* # of SEC filersGAAP UsedMarket Capitalization (billions) 140IFRS Canadian GAAP US Other 613 Total foreign private issuers US domestic Issuers 8484US GAAP11254 Total SEC registrants IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | 10

What About Private US Companies? Nearly 20 million private companies in US –Many are owned by IFRS parents –Many more have IFRS foreign operations No general statutory requirement to use US GAAP –Very few use US GAAP per FASB Growing interest in: –Full IFRS; or –IFRS SMEs 2008 IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | 11

XBRL Standard setters more aware of importance IASCF Trustees and SAC also briefed Projects of particular significance –Disclosure framework –Financial statement presentation XBRL even more important for those using full IFRSs and also IFRS_ SME financial statements 2008 IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | 12

2008 IASC Foundation | 30 Cannon Street | London EC4M 6XH | UK | 13 Questions or comments? The views expressed in this presentation are those of the presenter. Official positions of the IASB on accounting matters are determined only after extensive due process and deliberation.