Thu, Jun 09, 2011 - Page 12 News List

FSC reiterates move to implement new standards

By Crystal Hsu  /  Staff Reporter

Financial Supervisory Commission Chairman Chen Yuh-chang, center, and International Financial Reporting Standards (IFRS) Center director Chang Chen-shan, right, unveil the plaque for the IFRS Center at the Securities and Futures Bureau at an opening ceremony in Taipei yesterday.

Photo: George Tsorng, Taipei Times

The Financial Supervisory Commission (FSC) said yesterday it would press ahead with a plan to ask Taiwanese businesses to use new bookkeeping rules from the first quarter of next year so that all public companies can issue financial reports based on the new standards in 2013.

Local companies listed on the Taiwan Stock Exchange or GRETAI Securities Market, as well as financial institutions that are under the commission’s supervision, are required to adopt the International Financial Reporting Standards (IFRS) under the commission’s plan.

Commission Chairman Chen Yuh-chang (陳裕璋) yesterday reiterated the stance and agenda when inaugurating a service center for the new accounting rules at the commission’s Securities and Futures Bureau in Taipei.

The IFRS Service Center is intended to help companies better understand and employ the new standards, which Chen described as a neutral mechanism that won’t harm corporate finances.

The commission is gathering views from different sectors and experts before drawing up related guidelines by the end of this month, Chen said, as some remain divided on how to measure real-estate assets under the new rules.

While the introduction of IFRS is expected to bring a balance between risk and capital for life insurance companies, they will be required to conduct stricter liability adequacy testing and disclose more financial details. As a result, insurers have pressed for recognition of market value in valuing their assets, while the commission considers it better to use acquisition costs to determine the value of assets.

Even so, Chen said four companies — chipmaker Taiwan Semiconductor Manufacturing Co (台積電), state-run Mega Financial Holdings Co (兆豐金控), chemicals maker Swancor Industrial Co (上緯企業) and diffuser plate maker Entire Technology Co (穎台科技) — will next month unveil their IFRS-based financial results for last year to set an example for other listed firms.

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