A clear case of non-standardisation

For those of you who have always worked in Poland or have done so for some considerable period of time, it will be clear that the answer is quite simply because it is. For those still fighting the national need to be different, let me just say that I tried to go against the flow for the first 10 years of my career in Poland but have now bowed to the inevitable.
So how is Poland different as far as my profession is concerned? Well, where do I start? Last time I wrote indirectly about globalisation and the need to adopt uniform accounting and auditing standards. The process was started some years ago as a result of which we now have a considerable body of knowledge contained in the international accounting standards (IAS). These were originally designed to be adopted by those countries too small or too poor to be able to develop their own national standards.
Over time, the standard-setting process has been refined and expanded with the intention that ultimately ALL countries will adopt the IAS, and that accounts produced in Alma-Ata will be the same as those filed in Alabama. Indeed, from 2005 all European Union-quoted companies will have to report under IAS. The reason for standardisation is very simple. Investors are now global players as are corporations, and therefore have a need to be able to compare accounting data produced in different parts of the world as well as to have confidence in the reliability of that data.

The continued existence of different locally acceptable accounting standards across the world (and a complete lack of standards in some countries) leads to confusion as well as jurisdiction shopping (hiding dubious transactions in jurisdictions where the results can be shown more favourably). The existence of different standards also makes it very difficult to compare the performance of otherwise very similar businesses.
So where does this country stand? Well, first you would have to look long and hard to find any Polish accounting standards. You will find a very thin volume called the Accounting Law which leaves more questions unanswered than problems solved. This legislation states that where the law is not prescriptive companies MAY use national standards, and in the absence of these MAY use International Accounting Standards. Note the word "may" rather than "must" or "will". Of course, the Ministry of Finance took almost two years to get around to deciding how national accounting standards would be set, but to date with no output. This august body will no doubt in time produce something.

The question, of course, is whether these standards will be different to IAS or the same. If Polish national standards will be significantly different, Warsaw Stock Exchange-quoted companies will be forced by the EU to adopt IAS in contravention of national standards. If, on the other hand, the Polish standards will be the same as IAS, then why bother? Well, of course, the "why bother" is first to give employment to ageing professors of accounting otherwise bypassed by the new world order, and second to once again prove to the world that Poland will do things its own way.
And last, why allow rather than force companies to adopt standards? This strange legal formulation resulted apparently from a long battle in Parliament where MPs argued that for many companies it would be too difficult to comply! A strange argument for legislators hell-bent on drafting totally incomprehensible legislation to apply in respect of a body of knowledge developed by the world's finest accounting theoreticians and practitioners and destined to be adopted worldwide.
Which brings me back to the US. Logic might dictate that in view of the adoption by the EU of International Standards, the US might itself move in the same direction. Answers as to why not are most welcome on the back of a postcard.

Andrew Kinast is the managing partner of Grant Thornton Poland.