About 81% of North American life insurance company chief financial officers believe that the United States and Canada will join with Europe in adopting a global accounting standard for insurance within 10 years, according to the Tillinghast business of Towers Perrin in its latest CFO survey.
However, only about 28% of the respondents said they believe this will happen within five years, according to the survey released Tuesday by New York-based Tillinghast. Opinion varied on whether "fair value" will be the chosen standard. Nearly two-thirds of the respondents said fair value is highly or somewhat likely to become the accepted industry standard in their country regardless of whether a global standard is adopted. All other respondents said they expected the standard to include some aspects of fair value but not all.
The survey - the eighth in a Tillinghast series - found that this perceived trend has made companies keenly interested in developments surrounding the adoption of a Phase 1 international accounting standard by the European Union, to take effect for 2005 statements. About 47% of the respondents said they plan to increase their monitoring activity regarding proposals for international accounting standards.
