NU Online News Service, June 22, 3:54 p.m. EDT

The Group of North American Insurance Enterprises said it has joined a new coalition to work with accounting organizations to reform accounting standards linked to the financial crisis.

GNAIE said the new group involves trade associations, representing all sectors of the economy and areas of the financial services arena, that will engage the Financial Accounting Standards Board and the International Accounting Standards Board on a series of reform projects.

"The drive to revise accounting standards for financial instruments is gaining fresh momentum both in the United States and internationally," said GNAIE executive chairman Jerry de St. Paer.

"These developments make it essential for the insurance industry and other affected businesses to provide input, assistance and perspective to U.S. and international standard-setters that will enable them to develop high-quality, robust standards. Our new coalition will help attain those goals," added Mr. de St. Paer.

Last week, the Obama administration announced regulatory reform measures including reviews of accounting rules and an acceleration of accounting reforms related to the financial crisis.

In April, The Financial Crisis Advisory Group, a joint committee of FASB and IASB, wrote G-20 leaders informing them of efforts to overhaul accounting rules, the GNAIE noted.

It mentions that these projects include efforts to replace, update or converge the current accounting standards for financial instruments, consolidation and derecognition, some of which are expected to be completed by the end of 2009.

Mr. de St. Paer said members of the new coalition, the Financial Instruments Reporting and Convergence Alliance (FIRCA), were committed to a set of principles:

o Supporting the adoption of joint IASB-FASB international, high-quality, robust accounting standards of a "decision-useful, reliable and relevant" nature, presenting financial information in a manner that is "reflective of the business operations of an entity," providing transparent information and not driving economic activity.

o Assisting standard-setters in providing a wide range of input to ensure the proper consideration of business operations and potential unintended consequences in the development and implementation of accounting standards.

o Recognizing that the financial crisis is global in scope and magnitude and working with standard-setters and decision-makers to insure that these projects are conducted jointly to ensure a comprehensive response to financial reporting policies.

In addition to GNAIE, founding members of FIRCA are: American Council of Life Insurers, Commercial Mortgage Securities Association, Council of Federal Home Loan Banks, Mortgage Bankers Association, Property Casualty Insurance Association of America (PCI), The Financial Services Roundtable, The Real Estate Roundtable and The U.S. Chamber of Commerce.

GNAIE said its goal is to influence international accounting standards to ensure that they result in "high-quality accounting and solvency standards for insurance companies and, to that end, to increase communications between insurers doing business in North America and international regulators and standard-setters."

The organization said it works to meet its goals through modeling of proposed accounting standards, analysis, comment and coordination with various end users of financial reports.

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New Group On Accounting Standards Formed With GNAIE

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