The U.S. Securities and Exchange Commission has published for public comment a proposal to eliminate the current requirement that foreign private issuers reconcile their financial filings with U.S. accounting standards if they are already using international standards.

The proposal applies to foreign private firms filing their financial statements using International Financial Reporting Standards. Under the SEC’s current rules, these issuers are required to reconcile the financial statements they file with the commission to U.S. generally accepted accounting principles if their financial statements are prepared using any basis of accounting other than U.S. GAAP.

“The commission has taken a significant step on this important policy matter that was outlined in the ‘Roadmap’ announced in 2005,” said SEC chief accountant Conrad Hewitt. “The staff continues to evaluate the considerations supporting the acceptance of IFRS financial statements and looks forward to receiving public input during the comment period.”

John White, director of the commission’s Division of Corporation Finance, said, “Along with the commission’s work relating to internal control reporting and deregistration, this proposal to accept financial statements prepared in accordance with IFRS as published by the IASB without a U.S. GAAP reconciliation represents another significant action to tailor the regulatory environment for foreign companies in the U.S. public capital markets. We look forward to public feedback on this initiative.”

The commission voted unanimously to issue the proposal for public comment.

SEC staff also published a report noting some general observations about the application of IFRS based on staff reviews of annual reports from more than 100 foreign private issuers containing financial statements prepared for the first time using IFRS. Additionally, the agency has launched a new Web page that consolidates SEC staff correspondence on those completed filing reviews as well as company responses to the comment letters.

“With a significant number of first-time IFRS filings already reviewed by the Division of Corporation Finance, we are launching this SEC Web page linking to the actual text of our comment letters to help provide easier access to investors,” White noted.

The comment period extends for 75 days after.