Accounting leaders are forming a panel to explore whether there’s a case to be made for having separate accounting standards for public companies compared with private entities.

The Financial Accounting Foundation, the American Institute of Certified Public Accountants, and the National Association of State Boards of Accountancy have formed a “blue ribbon” panel to explore how U.S. accounting standards can best meet the needs of the users of financial statements provided by private companies.

The blue-ribbon panel will be made up of a cross-section of financial reporting constituencies, including lenders, investors, owners, preparers, auditors, and regulators. It will be charged with making recommendations on the future of standard setting for private companies, including whether private companies should have separate accounting standards.

U.S. accounting experts have long debated whether private companies should be held to the same standards set for public companies because the needs of users may differ. Private companies tend to be more closely held with a much smaller group of investors.

U.S. Generally Accepted Accounting Principles do not make broad exceptions to public company standards for private companies, but the International Accounting Standards Board recently issued a complete accounting standard specifically tailored to smaller and medium-sized entities.

AICPA President Barry Melancon said there have been efforts in the United States to look at the potential for technical differences for public vs. private company requirements. The new blue-ribbon panel, however, will look more at the public policy issues. “What is the appropriate way forward for potential differences for public companies and private companies?” asked Melancon. That might include adoption of IFRS for SMEs in the United States, or it might mean something else, he said.