Truly global capital markets are becoming a reality
By Sonja van der Waldt
Posted on 10 September 2009
Truly global financial reporting standards and genuinely global capital markets may be a reality much sooner than is generally expected, says Professor Mary Barth, former member of the International Accounting Standards Board (IASB) and Professor of Accounting at Stanford University’s Graduate School of Business.
Speaking at the University of Pretoria (UP), where she lectured in the Master’s programme in Accounting Sciences offered by the Department of Accounting, Professor Barth said that global financial reporting can improve the functioning of global capital markets by providing better information to investors and other users of financial statements.
“The result of truly global financial reporting would be one language of business, which will enhance the comparability of accounting information,” she said. All these benefits should result in a decrease in the cost of capital for global firms, which is the ultimate goal.
Professor Barth served on the IASB from 2001 to June 2009. During her term, International Financial Reporting Standards (IFRS) were implemented in more than 100 countries, including the European Union. South Africa has been a front runner in IFRS implementation in Africa. Other African countries such as Botswana, Ghana, Kenya and Tanzania have all shifted to IFRS. Professor Barth said that all eyes are now on the United States, which is in the process of considering the adoption of IFRS.
Professor Barth said that accounting educators have a key role to play in global financial reporting. “We need to educate accounting students for the world they will live in, not the world we lived in. Their world is global. No single country can stand alone in such a world,” she said. She warned accounting educators that by continuing simply to teach students the existing rules and bookkeeping, educators increase the risk of attracting the wrong people to the profession.
Professor Elmar Venter of the Department of Accounting at the University of Pretoria stressed that South African universities have a responsibility towards the profession and towards society in general to deliver accounting graduates that are more than merely sophisticated bookkeepers. In his view accounting education should look beyond focusing on technical menus. Economic concepts and professional judgment should be emphasized, while also ensuring that students are up to date with the latest findings of accounting research.
Professor Venter said that the University of Pretoria is delighted to have Professor Barth presenting a workshop to the University’s Masters students. “Professor Barth is considered to be one of the best academic accountants of her generation and one of the most prolific accounting researchers. The University of Pretoria’s collaboration with world-class academics is in line with its strategy to improve its ranking among world universities, and its aim of establishing itself as an internationally recognised research university with the highest academic standards,” he said.
For more information, contact Prof Elmar Venter, tel: 012 420 3420 or e-mail: firstname.lastname@example.org