For all the heated debate among standard-setters about convergence, the true test of International Financial Reporting Standards (IFRS) was always going to be their implementation by real companies in real accounts. That test has only recently begun in the European Union, with the publication of half-year results, the first under IFRS. The mood in corporate Europe is, to say the least, mixed. Most notably, the volume of criticism from UK groups - previously among the strongest supporters of the project - seems to be on the rise.
Two speeches last week by Charlie McCreevy, Europe's internal market commissioner, neatly frame the debate.
The EU has played an equivocal role in the evolution of IFRS. It has intervened in the process at the behest of regulators and banks, modifying IAS 39, the standard for financial instruments such as derivatives, and diluting its benefits. It has also proposed, unhelpfully, tinkering with the governance of the International Accounting Standards Board (IASB), the body that is trying to bridge philosophical and practical differences over the project.
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