Who would have thought of accounting as a national security issue? 

David Albrecht is a professor of accounting at Bowling Green State University in Ohio and an opponent of U.S. adoption of IFRS.  For a quick recap of his case against IFRS listen to the podcast of highlights from his interview. 

On his blog, The Summa , Professor Albrecht offers a national security argument against IFRS:

• European adherence to the free flow of capital is self-serving. 

• The economic theory of free flow of capital absolutely requires accounting standards such as today’s IFRS.  Because the U.S. is such a large actor in the world economy, the economic theory of free flow of capital absolutely requires the U.S to discard GAAP and adopt IFRS. 

• Capital can be viewed the same way as other national resources such as precious minerals or the productive capacity for military defense.  Said another way, strategic capital management is an essential aspect of the national security. 

• When viewed from this point of view, it is easy to see that U.S. GAAP and SEC enforcement and the Sarbanes-Oxley emphases on internal controls and auditor inspections are essential to the national security of the United States.

Decisions about accounting policy, like decisions about any other policy, are political decisions.  Let anyone who doubts that read the recent history of mark-to-market accounting by banks.  Professor Albrecht’s mercantilist argument brings to the IFRS discussion a political theme that harmonizes well with the “Buy American” provisions in the Congressional proposals to rescue auto makers  For more detail, visit his blog.  In the fall of 2008, he also marshaled a series of technical arguments against IFRS from some of the most prominent IFRS critics.