It reflects the growth of publicly-traded markets, coupled with rapid growth in innovation and complexity. The potential for opacity has therefore increased, so it is essential that accounting standards are clear and capture the economic substance. This is important for the various stakeholders, and for financial stability generally. It is also important that the actual processes for developing accounting standards command widespread support from companies, investors, creditors and the public authorities. I have set out a few steps that might be of relevance in achieving this. On IAS 39 specifically, it would seem to me sensible to try first to reach consensus on the fundamental issues I started with before moving to detailed drafting of a new accounting standard. This will require a continuing effort on the part of standard setters to engage all interested parties, flexibility from everyone involved and a high level of transparency within the process. A lofty goal perhaps, but important if the benefits are to be secured and we are to avoid the cacophony of today. 4  BIS Review 71/2004  In conclusion, although I have focused on controversies in accounting, we should recognise that we may be on the threshold of a truly significant step forward in accounting practice. From next year, companies throughout the European Union will be using the same set of high quality, international accounting standards. And there is the tantalising prospect of convergence between international and American standards. The challenge now is to realise the full potential of these changes. BIS Review 71/2004  5

The ongoing liberalisation process meant that it was no longer important to divide the balance of payments statistics into koruna and foreign currency transactions. This classification was replaced by a standard breakdown into transactions between residents and non-residents. Numerous statistics linked with regulation were gradually abolished as individual areas of economic activity were liberalised. These examples merely illustrate how the central bank’s entire statistical system was rebuilt from scratch. Let me now move on to the more recent past. In 1999 we began to co-operate closely with European institutions. The main topics included monetary and banking statistics, balance of payments statistics and more recently also financial accounts, government financial statistics and general economic statistics. The development of statistics was influenced by a need to standardise each area to ensure compatibility between the EU Member States and the candidate countries. Hand in hand with these contacts, we began to work much more closely with the Czech Statistical Office. In the area of statistics the Czech Statistical Office is the natural and closest partner of the Czech National Bank, since these two institutions are the major producers of statistical information in the Czech Republic. The Czech Statistical Office conducts a far wider range of statistical surveys, providing aggregate information on the national economy, territory, climate, environment, population, elections and other areas of life and activity of our country. The Czech National Bank is above all a user of economic  BIS Review 49/2004  1  statistics and collaborates most closely in this area.