The Securities and Exchange Commission has adopted amendments to ease foreign private issuers’ move to adopt international accounting standards, known as International Financial Reporting Standards.

The SEC’s amendments provide an accommodation to issuers that change their basis of accounting to IFRS prior to, or for, the 2007 financial year. The amendments also require certain disclosures from all foreign private issuers that adopt IFRS for the first time during any financial year. The commission notes that it is not changing current requirements regarding the reconciliation of financial statement items to U.S. GAAP.

The commission says it is adopting these amendments to promote and encourage the use of IFRS as a high quality set of accounting standards. “Because the Commission also recognizes the significant efforts associated with the adoption of IFRS, the accommodation is also intended to ease the burdens that foreign companies may face when they adopt IFRS for the first time, while improving the quality of financial disclosure that they provide to investors,” it says. “Issuers that apply accounting standards as adopted by the European Union in a manner that does not fully comply with IFRS are eligible to use the accommodation if they provide U.S. GAAP and IFRS reconciling information, if necessary.”

To be eligible to rely on this accommodation, a foreign private issuer must adopt IFRS for the first time prior to or for its first financial year starting on or after January 1, 2007.

The amendments also require certain disclosures from issuers that adopt IFRS for the first time in any financial year. These requirements relate to an issuer’s reliance on any of the transitional measurement exceptions available to a first-time adopter under IFRS and to the reconciliation to IFRS from the issuer’s previous basis of accounting.

“These amendments will facilitate the transition by foreign registrants to IFRS and will promote investor protection by requiring comparable, high quality information,” said. “In connection with the adoption, Donald Nicolaisen, chief accountant of the SEC. “We believe investors and issuers are well served by the greater comparability that will result from broader use of IFRS, and look forward to many companies switching to IFRS in their SEC filings.”