The future of the international financial reporting standards (IFRS) has suffered a blow following pressure from the European Central Bank (ECB).

IFRS is designed to harmonise global accounting rules. The rules will apply to insurance companies from January 2005.

The committee advising the European Commission on IFRS gave in to demands by the ECB to modify IAS39. This section of the European standard relates to the fair value measurement of financial assets and liabilities.

Ken Wild, global leader of Deloitte's international accounting standards practice, said: "It is detrimental to the future of IFRS. It reduces the unity of the standards with the rest of the world."

Wild said that more modifications could now follow.