MADISON, Wis.–The World Council of Credit Unions has sent a comment letter to the International Accounting Standards Board in response to its Conceptual Framework for the Financial Reporting Exposure Draft in which it argues that at least some types of credit union shares qualify as equity on an accounting basis, such as the U.S. corporate credit union capital shares.
WOCCU acknowledged that while the proposal is related to International Financial Reporting Standards, it may impact U.S. GAAP in the long run because IASB and the Financial Accounting Standards Board (FASB) have agreed to try to “converge” IFRS and U.S. GAAP long term.
The letter notes, for example, that one component of the proposal creates confusion for credit unions. “If finalized as proposed, the addition to paragraph 2.14 appears likely to create a system where it is not clear whether or not an instrument is equity or a liability,” the letter states.
A complete copy of the letter can be found in CUToday.info’s Open Vault here. http://www.cutoday.info/Open-Vault-Articles2