The International standard-setting body, the IFRS Foundation is made up of a three-tier structure. That is the Monitoring Board, the Trustees, the standard board, and Interpretations Committee. In this article, let’s explain what’s what each of the structures does.
IFRS Foundation Monitoring Board
The Monitoring board ensures public accountability of the IFRS Foundation. It was formed in January 2009. And was entrusted with providing a formal link between the Trustees and public authorities. The members are from the capital market authority. The job of the monitoring board includes
- Monitoring the Trustees to ensure that they do their duties.
- Meet with the Trustees at least once a year.
- Approve the appointment and reappointment of a member of the Trustees
- Ensure the Trustees comply with the IFRS Foundation Constitution.
- They carry out independent reviews of the governance framework of the Monitoring Board and,
- It developed a work plan for the IFRS Foundation Monitoring Board which will be updated periodically.
IFRS Foundation: The Trustees
The Trustees carry out governance and oversight functions for the IFRS Foundation and the International Accounting Standards Board. Members are appointed for renewable three years tenure. In addition, each Trustee is expected to have knowledge and understanding of current issues. In addition, they should know what’s going on in the international scenes, and how they will affect the international organizations. Their duties include:
- They are accountable to the Monitoring Board.
- They oversee the activities of IASB and IFRIC.
- Each trustee should sense current events that may affect international organizations.
- Publish a consultation paper for public comments.
The International Accounting Standards Board (IASB)
This is a group of experts with practical experience in serving accounting standards, preparing and auditing financial statements. These experts must know how to use financial reports and teach accounting. The Board is accountable to the Trustees. Its duties are primarily the development of the International accounting standard and the IFRS for SMEs. Furthermore, it approves interpretations developed by the IFRS Interpretation Committee.
IFRS Interpretation Committee
This interpreted the standards developed by IASB. The IFRIC works alongside the board to provide the application of the IFRS standards. They answer questions about the application of the standards. Furthermore, it attends to other duties requested by the IASB. 14 experts make up this committee. And they are appointed by the Trustees of the IFRS Foundation.
IFRS Foundation’s organizational structure is made up of three parts. The public accountability tier is the monitoring board. The governance tier is the Trustees and the standard-setter which are there international Accounting Standard Board (or the Board) and International Financial Reporting Interpretation Committee (IFRIC).