Financial services professionals and firms need to do a better job of implementing globally accepted international standards for financial reporting, according to a new report from a task force led by the International Federation of Accountants.

The report, released Thursday by a group known as the Private Sector Taskforce of Regulated Professions and Industries, calls for the G-20 to encourage and support the development, adoption, and implementation of one set of globally accepted standards  in these and other areas.

The Private Sector Taskforce Report to G-20 Deputies presents a set of recommendations on how to promote regulatory convergence from the perspective of a number of financial professions and industries.

The PSTF was established in May at the request of the Presidency of the G-20. The report aims to provide the G-20 with an analysis of the development of financial policy and regulation, with the goal of facilitating economic stability in global capital markets. The benefits of regulatory convergence are identified in the report, along with the inefficiencies and associated costs created by regulatory gaps. The report analyzes a range of possible scenarios and associated risks, and provides a set of recommendations for global regulatory convergence.

Coordinated by the International Federation of Accountants, the taskforce includes International Accounting Standards Board, the CFA Institute; the Institute of International Finance, the International Actuarial Association, the International Corporate Governance Network, the International Insurance Society, the International Valuation Standards Council, and INSOL International.

“We have made great strides in regulatory convergence, but there is much more to be achieved,” said IFAC president Göran Tidström in a statement. “The Global Financial Crisis highlighted the importance of regulatory convergence—for example, the need for globally accepted high-quality standards across a number of areas, including financial reporting, auditing and auditor independence, as well as consistent implementation and enforcement—which are important for encouraging global economic stability. IFAC supports the G-20’s work to reform the international financial system and reduce informational uncertainty and risk, and thus avoid future financial crises. The PSTF report encourages the G-20 to maintain its current momentum towards international convergence, identifies existing gaps, and offers insightful recommendations. There will be no better time to progress these issues.”

The report stresses the need for open communication and transparent processes, along with continued cooperation between national and regional regulators and professional and industry groups, in order to further develop global standards. It warns against the dangers of unilateral decision making, and advocates enhanced consultation and global cooperation on matters of regulatory reform, in order to avoid regulatory fragmentation.

“Enhanced coordination and consultation with all stakeholders is imperative,” said IFAC CEO Ian Ball. “Unilateral policy reform initiatives make it more difficult to achieve convergence—on the contrary, they constitute regulatory fragmentation. The PSTF report represents a collaborative effort by a diverse group of professions and industry bodies; we hope jurisdictions worldwide can likewise come together to support the cause of economic stability.”

-- This article first appeared on Accounting Today.