Accounting - Shifting standards at the ASB.

(From Financial Director)

Byline: Peter Williams, a chartered accountant and freelance journalist.

Mary Keegan is to swap her desk at the Accounting Standards Board in July for a presumably grander one at HM Treasury. As she steps down as ASB chair, she could be forgiven for thinking the role she is leaving behind is a world away from the job she signed up to in late 2000.

Ironically, it is HM Treasury which has highlighted the radically different role that ASB is now playing. As well as its watching brief and work on the international scene, the ASB has been handed two pieces of work by the government - sorting out the complicated Operating and Financial Review (OFR) and trying to find a patch for pension reporting after the Equitable Life debacle.

Those tasks show just how far the ASB has moved from its self-appointed agenda of the early 1990s. The work on the OFR - a statement first created by the ASB - has been taken over by the government with its decision to make it a legislative requirement and its intention to put much of the detailed requirement into primary legislation. So the ongoing role the ASB has in the OFR appears to be translating and making practical sense of the government's requirement for the business community.

A greater indication that the government sees the ASB as a body to do its bidding is the extraordinary enquiry into insurance accounting. This was sprung upon the ASB following the release of the Penrose report into the near-collapse of Equitable Life. Financial secretary Ruth Kelly told MPs she had asked the standard setter to initiate a study into the accounting for with-profits business by life insurers. According to Kelly, "The study will have particular emphasis on identifying ways of improving the transparency of reporting."

The ASB complied with the request by announcing a hastily assembled Advisory Panel, while noting the Treasury had given it a very challenging remit.