Moreover, the Basel Committee's approach to its new Capital Accord, with its market-discipline component in Pillar 3, signals that sound accounting and disclosure will continue to be important aspects of our supervisory approach for many years to come. Many U.S. banking organizations have assumed that international accounting standards are essentially irrelevant to their financial reporting activities.
However, the Sarbanes-Oxley Act includes a directive that U.S. accounting standards should seek convergence internationally. In view of this, the FASB and the IASB announced in October 2002 a major agreement to intensify their projects that seek international convergence and harmonization of accounting standards.