What Is The Norwalk Agreement

Under this agreement, the FASB and the IASB signed a Memorandum of Understanding on the convergence of accounting standards. The proposed lease is perhaps the clearest example of how such differences have led to a collapse of convergence. After half a decade of deliberation, following an agreement in principle on the notification of leases longer than 12 months on the company`s balance sheets, the two boards of directors announced their decision to look differently at lease reports at a joint meeting on August 27. The split led to disagreements over whether lease accounting should take a dual or ad hoc approach. The Norwalk Agreement refers to a Memorandum of Understanding signed in September 2002 between the Financial Accounting Standards Board (FASB), the Standard Setter and the International Accounting Standards Board (IASB). [1] The agreement is referred to as it was concluded at Norwalk.

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