The g20 sends two messages to the financial sector and investors from around the world

The 20 heads of State and Government meeting on 2 April in London issued a statement on the consolidation of the financial sector which should sound in the ears of listeners, Commissioners to auditors and other sales professionals. In a few lines, they indicate on what basis the accounting standards applicable to the financial sector should be reviewed and corrected: thus end dreams of independence demonstrated in recent years by the masters of accounting.

Professionals from sales are parties of a fair finding that with the progress of globalization, the world had need of accounting standards identical leading to a questionable conclusion namely, that, without anything to anyone, they are autosaisiraient of the subject and that they would themselves create these universal standards. And so, since the beginning of this century, their international association is working to impose the famous rule of fair value ("fair value"), by putting forward their competence and their independence professional to dictate their laws in the States, to the companies and investors.

Accountants held to intangible principles which is now measured the limits: the first is that the fair value corresponds to the value of market; the second is that changes in values must be taken into account in the calculation of the result of operating companies. In recent years, accountants are deploying tons of energy and paper to define the fair value of the assets or liabilities that do not result in exchange markets. As to the inclusion of changes in value in operating income, she had considerable success and followers as long as conditions was the values rise (and variable remuneration), but we see the destabilizing consequences that it has when everything collapses. The attribution of changes in value may be bearable in companies that incorporate little capital (material or immaterial) in their factors of production, but it is strictly dramatic in the financial sector, which receives and manages the assets and capital available for all economic agents. It must be recognized that the French bankers, relayed by President Chirac, have been the first to measure the danger of the application of these new rules to the financial sector.

The g-20 sends two messages to the financial sector and investors from around the world. First, he asked the sales professionals to discuss in a vacuum of accounting standards, and to at least expand the circle of their discussions to the financial sector supervisors. When you know who are these supervisors (in most States, these are central banks or State agencies), we understand that, under the guise of supervisors, States to invite now at the negotiating table. In so doing, the g-20 doubts not the approach of such accounting standards that committed so far, but asks a right of access and control. While he was there, the g-20 could go even further and formally establish an international body, open to all, transparent in its operation to that mission would have been recognized for universal accounting rules. Once it comes to institute an accounting language which is binding on everyone, this instance should be the concert of nations, and be placed somewhere in orbit or under the control of the United Nations and the IMF.

The other message of the g-20 is to ask that the accounting standards applicable to the financial sector include a certain amount of caution. It cannot be said that accounting standards are responsible for the financial crisis, which has its source in the fact that the financial sphere manufactured and traded in her breast so sophisticated products that it is not known what value to assign. Financial sector however has the particularity to be subject to prudential regulation which is itself sitting on accounting standards, and it is sufficient that accounts degrade that prudential standards are strangling the financial sector as a tourniquet.

The accounting standard-setters will have, under the eye of the supervisors, put water in their wine and prudence in their standards. The g-20 incentive for example to take account of the horizon of detention in the assessment of the value of a debt or debt; they will have to admit that the off-balance is part of the balance sheet, financial sector includes margins of safety in the accounting for certain transactions, is counter-cyclical reserves that will be fired during a boom to in times of crisis. Here again, the g-20 is very measured in its requirements: it asks only that the standard-setters and supervisors are a new and fair balance between prudence and transparency. They will have had to pay thousands of billion dollars or euros that States have the right to hear this message of reason.