FASB, IASB Form Crisis Advisory Group

Accounting rule makers have formed an international all-star team to help chart a path out of the current financial crisis.

The Financial Crisis Advisory Group, formed by the Financial Accounting Standards Board and the International Accounting Standards Board, is tasked with helping the rule-making bodies sort out the standard-setting implications of the current global financial crisis and potential changes to the global regulatory environment.

The advisory group won’t try to establish consensus or recommendations, but will provide input to FASB and IASB through group meetings. FASB and IASB plan for the group to meet on a rotating basis in New York and in London for only about six months or less. Meetings generally will be public, although co-chairs Harvey Goldschmid, former commissioner with the Securities and Exchange Commission, and Hans Hoogervorst, chairman of the Netherlands Authority for the Financial Markets, have the discretion to hold private sessions as well.

FASB and IASB said the makeup of the advisory group includes senior leaders with broad experience in international financial markets and an interest in the transparency of financial reporting information. U.S. representatives on the 18-member advisory group include John Bogle, founder of Vanguard; Jerry Corrigan, former president of the New York Federal Reserve Bank; Gene Ludwig, former Controller of the Currency; and Don Nicolaisen, former chief accountant for Securities and Exchange Commission. Observers represent the Basel Committee of Banking Supervisors, the Committee of European Securities Regulators, the International Association of Insurance Supervisors, the Japan Financial Services Agency, and the SEC.

Although the group has a short shelf-life, Goldschmid says that doesn’t mean results will come quickly. “There is much to be considered, and we will proceed as quickly as possible, with an understanding these are complex issues with large public policy stakes and many interdependencies,” he said in a prepared statement. “There are likely to be few quick fixes.”

Hoogervorst says the diversity and seniority of the group “will help to ensure that any enhancements to financial reporting are considered in the context of the broader financial system and measured against a benchmark of enhancing investor confidence.”