16 February 2004

Mr Charles Macek
Chairman
Financial Reporting Council
The Treasury
CANBERRA ACT 2650

Dear Charles

Year 2005 Strategy

The Group of 100 (G100) has been advised that the views expressed in a letter to David Boymal, Chairman – AASB, dated 12 January 2004, are to be discussed by the FRC at its meeting on 27 February 2004.

I write to reinforce our views that some flexibility in the implementation of the Year 2005 strategy is highly desirable if the economic interests of major Australian companies are to be sustained.

As outlined in our letter to the AASB we believe that inclusion of an alternative treatment in the Australian equivalent of IFRS 1 under which a company may elect to retain its existing approach to accounting for identifiable intangible assets at the time of adoption of Australian equivalents to IASB Standards is feasible and appropriate.

Our concerns about the potential adverse effects on Australian companies and the quality of financial reporting in Australia are not limited to accounting for identifiable intangible assets. For example, adoption of IASB proposals in respect of accounting for insurance contracts would have an adverse impact on the quality and relevance of reporting by insurers.

Yours sincerely

John V Stanhope
National President

c.c. Mr Tom Pockett

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