Definition: The International Accounting Standards Board, typically abbreviated IASB, is the organization that establishes international financial reporting standards or IFRS that are accepted throughout the world. You can think of the IASB as the international FASB that creates accounting principles and standards like GAAP on an international level.
What Does IASB Mean?
The IASB consists of 14 members from various countries with different backgrounds in accounting, finance, and auditing. Each time the members meet, the meeting is broadcast live over a webcast, so the public can see what where the future of international accounting standards is heading.
The process of establishing IFRS has six main steps. Before anything can happen, the board has to present a topic that needs to be addressed. Once a standard topic is presented the six steps begin. First, the board has to set an agenda to research information about the proposed standards to see how would affect industries and financial markets.
Second, a plan must be put in place to preform the research and identify the partners that will help with the project.
After limited research is done on the new proposed standard a discussion paper is created and published, so the public can understand the topics that the board is dealing with and start to develop their own opinions. The discussion papers are usually a broad overview of a general topic. No specific standards are mentioned.
Fourth, an exposure draft is published by the board to make the public aware of the actual proposed accounting standards. The exposure draft encourages the public to voice their opinion to the board about how the proposed standard would affect them if it were instituted.
Fifth, the board develops the standard and the publication that will announce the standard to the public when it is ready.
Sixth, the IFRS standard is issued to the public and the members of the board hold meetings with the public to address new issues arising from the newly instituted standards.