INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) FOUNDATION

International Accounting Standards Committee (IASC) was set up in 1973 through agreement between professional accountancy bodies (Professional Accountancy Body means boards that regulate profession of Chartered Accountancy in their respective countries like ICAP in Pakistan) of nine countries. The objective of IASC was to:

• Formulate quality International Accounting Standards (IASs) that would be observed internationally by  all countries
• Work generally for the improvement and harmonization of regulations, accounting standards,and procedures relating to the presentation of financial statements

Later on, the standard setting activities of IASC were delegated to IASC Board. Members of IASC Board were representatives from member countries of IASC.

In 2001, The IASC Board was replaced by a new body called INTERNATIONAL ACCOUNTING STANDARDS BOARD (IASB). IASB consists of Trustees who are of diverse geographical and functional background (meaning that they may not be full time accounting experts). The standard setting activities of the Board are carried out by members who are appointed based on their technical skill and background experience unlike IASC Board where members of the Board were representatives of the member countries of IASC.

Currently, the IASC that was set up in 1973 is called the IFRS Foundation and it comprises both the IASB and its Trustees. The objectives of IFRS Foundation as stated on its website are:

• To develop a single set of high quality, understandable, enforceable and globally accepted international financial reporting standards (IFRSs) through its standard-setting body, the IASB; 
• To promote the use and rigorous application of those standards; 
• To take account of the financial reporting needs of emerging economies and small and medium-sized entities (SMEs); and 
• To bring about convergence of national accounting standards and IFRSs to high quality solutions.

NOTE: International Accounting Standards (IASs) are guidelines for best practices in the accountancy profession. Now their name has been changed to International Financial Reporting Standards (IFRSs)