Toronto’s Paul Cherry, a prominent Canadian regulatory leader, will move to a global stage as chair of the International Accounting Standards Board’s Standards Advisory Council this year.
Toronto’s Paul Cherry has been appointed chair of the International Accounting Standards Board’s Standards Advisory Council (SAC). “This is a huge compliment for Canada,” says Cherry, the outgoing chair of Canada’s Accounting Standards Board (AcSB), whose term with that group ends this March 31.
“It’s absolutely ideal for allowing us to be a major part of the international standard-setting scene while Canada transitions to International Financial Reporting Standards (IFRS) in 2011. From that aspect alone, it’s terrific news.”
Not to mention that he’s “delighted” with the evolution of his work from the national to the international level. “It’s a lot like what I’ve been doing, but on a higher plane.”
Cherry describes his new responsibilities as “the continuous process of improving IFRS.”
The first of the council’s three 2009 meetings, scheduled for February, will “probably involve a bit of settling in.” But two topics will likely be “top of mind.”
What further action, if any, the IASB should undertake in light of the current turbulent market conditions, and examining views on part two of the IASC Foundation’s constitution review, for which the comment deadline is March 31.
Last December, following a strategy review over recent months, the IASC Foundation trustees announced proposals to enhance the organization’s governance arrangements and reinforce its public accountability.
This, says Cherry, will also lead to some restructuring of the SAC itself. “Previously, members were appointed in their personal capacity, where they expressed their own views — which is pretty much the way we operate in Canada.
“But now the committee is moving to a process of appointing senior people from important organizations, in the hope that they will bring some added clout by virtue of the positions they hold in their respective organizations.”
And there’s the challenge, he notes. “How do you get very senior people to put in the time and energy and feel it is worth the effort? I think it can be, but I need to convince the council of that as well.” And, he adds, “My number one priority, especially at that first meeting, will be to ensure that we have a shared view of the group’s mandate and vision.”
The SAC comprises representatives of a wide range of international organizations that advise the IASB on many issues, including its agenda and work programs. The SAC also provides advice on individual projects, with a particular emphasis on practical application issues.
The chair’s responsibilities include monitoring the progress of the IASB’s work program, projects and priorities, and working closely with the chair of the IASB and senior staff to identify just when the SAC’s advice is required. In effect, the chair is the primary liaison among the SAC, IASB and the IASC Foundation trustees.
The way Cherry explains it, “We’re not meant to second-guess the board on technical issues. Rather, our job is to advise on the work program, strategies and the priorities. Are there topics that need to be given higher priority? Are some issues taking too much time and energy to the detriment of more important things? This is where a group like us can make a major contribution.”
And, of course, Cherry adds, “there are issues such as the current credit environment. There is a tendency to look at the immediate problem, which is fair enough, but you also need to think beyond this — project out a few years to try to get ahead of the curve.”
But, he explains, “My primary function is to make the group effective, to have meetings that have sensible agendas addressing relevant issues … where the group feels it is making an important contribution to the system.”
International Accounting Standards Board Chair Sir David Tweedie says, “It is very good news that Paul has agreed to become SAC chairman. Paul is one of the most respected figures in international standard setting and I look forward with pleasure to working with him once again.”
He adds that the IASB “greatly values input from the Standards Advisory Council, especially during these challenging times.”
Gerrit Zalm, who chairs the trustees of the IASB Foundation, adds that, “The trustees are delighted that Paul Cherry has agreed to serve as the chairman of the Standards Advisory Council. His enormous experience as a standard setter heavily engaged in international activities, as a partner at a global accounting firm, and a former regulator will be invaluable to lead this important global and particularly representative advisory group.
“The council will continue to play an important role under his leadership.”
Apart from chairing the AcSB since 2001, Cherry served two terms on the board of the IASB’s predecessor, the International Accounting Standards Committee, and chaired its interpretative committee.
Before he headed up the AcSB, Cherry was a senior technical partner with PricewaterhouseCoopers in Toronto and chaired the AcSB’s emerging issues committee. He was chief accountant of the Ontario Securities Commission for two years and chaired the International Organization of Securities Commission’s working group on international accounting and auditing standards.
Kevin Dancey, president and CEO of the Canadian Institute of Chartered Accountants, says Cherry “will now carry Canada’s best interests onto the global stage. He has been a leader in Canadian standard setting and has been at the helm of the changeover to IFRS. This international posting is a testament to the high regard he carries.”