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This chapter traces the evolution of the IASB organization through its first decade, and reviews the changing composition of the trustees, the Board, the advisory council, the interpretations committee and the technical staff. The trustees exercised their right to appoint Board members by gradually shifting the emphasis in the Board from technical accounting expertise to a broader range of backgrounds and experiences. Several initiatives were taken to enhance the Board’s due process and to improve its communication with constituents. Establishing a secure funding basis for the IASC Foundation was a continuous preoccupation of the trustees. Gradually, the initial reliance on voluntary contributions was replaced by national funding mechanisms and by funding from the European Commission.

This chapter discusses the appointment of the initial trustees of the IASC Foundation, including their chairman Paul Volcker, and the trustees’ decisions and activities to bring the new IASB into being. The most vital of these decisions were the selection of the first chairman of the IASB and the other initial Board members. Once appointed, the initial Board chairman, Sir David Tweedie, played an active role in setting up the IASB. Other aspects of the IASB’s initial organization covered in this chapter include the creation of a Standards Advisory Council (SAC) and an International Financial Reporting Interpretations Committee (IFRIC), the building of a technical staff, and the soliciting of a sufficient amount of voluntary contributions to fund the new organization.

Between 2006 and 2009 the question of the IASB’s public accountability was resolved by establishing a Monitoring Board, mainly composed of securities regulators. The powers of the Monitoring Board, in relation to the IASB Board’s independence, were a matter of intense negations. In the course of the second review of the Foundation’s Constitution, a number of other changes were made in recognition of the IASB’s growing responsibility as the standard setter for companies in more than a hundred countries. Given the central role played by David Tweedie during the IASB’s first decade, the choice of his successor was a seen as a vital matter, testing the relationship between the Foundation trustees and the recently established Monitoring Board. The relationship was further explored in parallel reviews of the IASB’s governance and strategy conducted by the trustees and the Monitoring Board.

The tensions over IAS 39 and controversy over some of the IASB’s other projects, turned the first five-yearly review of the IASC Foundation Constitution into a debate on how to square the IASB’s identity as an independent technical expert group with demands for oversight and control from jurisdictions where IFRSs had the status of law. Key questions discussed included the appointment process of trustees and board members, control over the IASB’s agenda, and ensuring constituents’ right to a proper hearing by the IASB. In the end, the trustees made only minor adjustments to the Constitution. Yet, it was recognized that the trustees should be more active in overseeing the IASB, that the Board should enhance its procedures for consultation and feedback, and that establishing some form of accountability still required attention.