Change is never easy; and the bigger the change, the more it hurts. So it is no surprise that the European Union's ambitious project to require its 7,000 listed companies to adopt international accounting rules by January ist 2005 has been a difficult exercise. Earlier this month, all seemed done and dusted, when the European Commission endorsed the last of the 41 accounting rules issued by the International Accounting Standards Board (IASB). This highly contentious rule, IAS39, deals with accounting for financial instruments, such as options and derivatives. It had been the subject of a row between the IASB and the EU for months, and was accepted only after the commission won over the most vocal critics, including the European Central Bank and much of Europe's financial industry, by deleting passages of IAS39 to create a looser version of the rule.
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