An article that appeared in The Australian on 23 November 2005 by Blair Speedy, entitled ‘Aussie firms quick to adopt new regime’, included the following extract. Read the extract and evaluate the comments made by Sir David Tweedie, Chairperson of the IASB. Under the International Financial Reporting Standards, many intangibles can no longer be booked as an asset on a company’s balance sheet. The change saw News Corp, parent company of The Australian, this month book a first quarter loss of $US433 million ($588 million), due to a one-off accounting charge of $US1 billion relating to a change in rules governing the valuation of licences.

Sir David said intangible assets such as newspaper mastheads might one day be allowed to be booked as assets. ‘As we get smarter, perhaps we’ll allow some of them back on, but the rest of the world doesn’t believe in them at the moment because of their unreliability and arguments over how they should be measured, so we’ve said that until that’s settled, they should be off balance sheets,’ he said.