02/04/2012 (Financial Times) - Malaysian palm oil producers are spearheading a push to tailor international accounting rules more to the needs of Asia, Latin America, the Middle East and Africa.

The plantation owners are leading calls for the International Accounting Standards Board to address issues that have a particular relevance to these regions – such as agriculture, inflation and sharia law – in the coming years.

The campaign reflects the growing influence wielded by emerging markets in the global economy as their growth outpaces that of Europe and North America, which have traditionally shaped accounting rules.

Kevin Stevenson, chair of the Asian-Oceanian Standard-Setters Group, said: “We do think that Europe and the US have pre-occupied the IASB.” The group represents accounting technicians in 25 countries, including China and Australia.

Veronica Poole, a leading technical partner at Deloitte, the auditor, added that emerging markets “are becoming considerably more vocal” in their demands.

The IASB sets the International Financial Reporting Standards followed by listed companies in the European Union, Canada, Brazil, Russia, South Korea and several other countries outside the US.

In recent years, it has been focused on aligning IFRS with US rules in a potentially quixotic bid to create a global accounting language, while also trying to patch up flaws exposed by the financial crisis which largely affected the west.

But a recent consultation on its future activities pointed to a more geographically diverse future workload. PetroChina, the Chinese energy group, summed up the mood when it said: “The IASB should listen to emerging economies’ requirements.”

The most conspicuous emerging markets lobbying has been from Malaysian oil palm growers, such as United Plantations, IOI and Genting Plantations.

They say IFRS requires growers to waste time concocting artificial and misleading “fair value” accounting valuations for oil palm trees that are not destined to be sold.

In Malaysia last Wednesday, Hans Hoogervorst, IASB chairman, said agricultural accounting might indeed be reformed, adding that rules for economies suffering high inflation – a concern of Latin America – might also be tweaked.

However, the IASB is still to finalise its strategic priorities for the next three years and it is also yet to complete challenging projects such as an overhaul of the way banks account for bad loans.

One potential answer to capacity constraints within the IASB would be to sub-contract some research on accounting issues to national standard-setting bodies, Mr Hoogervorst suggested.

Subjects that could be examined in this manner included sharia-compliant transactions and foreign currency translation.

The latter topic is a particular bugbear for South Korea, which argues that accounts can sometimes be distorted by exchange rates produced by thin markets.