27 October 1982

Establishment of an Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting

The Economic and Social Council,

Recalling its resolution 1979/44 of 11 May 1979,

Having considered the report of the Ad Hoc Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting,

Acting upon the recommendation made by the Commission on Transnational Corporations at its eighth session concerning the establishment of an Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting,

1. Recognizes that the process of setting standards for accounting and reporting is complex, that it takes place primarily at the national and sometimes regional levels, and that the efforts of the United Nations should be oriented towards making a positive contribution to developments at those levels;

2. Agrees on the importance and desirability of achieving greater comparability with regard to disclosure by transnational corporations through, inter alia, appropriate action within the United Nations;

3. Approves the report of the Ad Hoc Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting and commends the Group of Experts for its work;

4. Decides:

(a) To establish an Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting composed of thirty-four members;

(b) That, taking into account the different existing systems of accounting and reporting and without prejudice to the principle of equitable geographical distribution, the Group should be composed as follows:

Nine members from African States;

Seven members from Asian States;

Three members from Eastern European States;

Six members from Latin American States;

Nine members from Western European and other States;

(c) That the members of the Group shall be elected by the Council at its resumed second regular session of 1982 and that each State so elected shall appoint an expert with appropriate experience in the field of accounting and reporting;

(d) That the members shall be elected for a period of three years, beginning on 1 January following their election, except that, for one half of the members elected at the first eletion, the term of membership shall be two years; members shall be eligible for re-election;

(e) That the Group should serve as an international body for the consideration of issues of accounting and reporting falling within the scope of the work of the Commission on Transnational Corporations, in order to improve the availability and comparability of information disclosed by transnational corporations; should review developments in this field, including the work of standard-setting bodies; and should concentrate on establishing priorities, taking into account the needs of home and host countries, particularly those of developing countries;

(f) That the Group should take into account the work of the Ad Hoc Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting as well as other relevant activities in the field;

should consult the international bodies which it deems appropriate on matters pertaining to the development of international standards of accounting and reporting; and should elicit views of other interested parties on specific issues on an ad hoc basis;

(g) That the Group should meet for a period of two weeks not more than once a year and should report to the Commission on Transnational Corporations on further steps to be taken in pursuit of the long-term objective of the international harmonization of accounting and reporting within the scope of the work of the Commission, particularly with regard to the comprehensive information system and the code of conduct on transnational corporations currently being formulated, on the understanding that duplication of work should be avoided;

(h) That the Commission, at its annual session, shall keep under review the work of the Group; in particular, it shall review the mandate, terms of reference and achievements of the Group after three years, with a view to deciding on the advisability of its continuation;

(i) That, as directed by the Group, the United Nations Centre on Transnational Corporations, through appropriate arrangements, should provide the necessary preparations and services for the Group's work;

(j) To request the Secretary-General to facilitate, when necessary, the effective participation of members of the Group through payment of their travel and subsistence expenses from extrabudgetary resources.