* FRC's Bischoff sees U.S. moving closer on global rules
* Bischoff expects prudence to make reappearance in rules
By Huw Jones
LONDON, June 10 (Reuters) - The United States may allow its companies to use international accounting rules while stopping short of making their use mandatory, a UK regulatory agency said on Tuesday.
World leaders have called for a single set of global book-keeping rules so investors can compare companies more easily.
So far, the United States has declined to adopt the International Financial Reporting Standards, or IFRS, which are written by the London-based International Accounting Standards Board. The rules are used in more than 100 countries and are mandatory in the 28-country European Union.
"My own view is that we won't get total harmonisation, that is having one set of accounting rules and standards across the world," Win Bischoff, the new chairman of Britain's Financial Reporting Council, which polices accountants and audit firms.
"There is increasing convergence - for example, the U.S. Securities and Exchange Commission has allowed global companies listed in New York to use IFRS," Bischoff told a financial conference organised by Lansons.
Foreign companies listed in the United States are not required to file separate accounts under U.S. rules, known as Generally Accepted Accounting Principles, or GAAP, and Bischoff said that flexibility could be expanded.
"I could see that American companies would be given the choice over a period of time. Will they stick to U.S. GAAP? Probably they will stick to U.S. GAAP, but I think the two standards are getting closer together."
There is talk in the accounting industry that the U.S. Securities and Exchange Commission, after resisting a switch to IFRS, may propose in coming months giving U.S. companies a choice of using IFRS or GAAP.
Observers say some big international U.S. companies would probably take up the offer, but domestically focused listed companies are opposed to mandatory use of IFRS.
Bischoff also said he was against special accounting rules for banks, which some lawmakers have called for after taxpayers had to bail out lenders in the 2007-09 financial crisis.
But he does expect more emphasis on "prudence" in the accounting board's rules, or deliberately erring on the conservative side in making some assumptions in bank accounts, especially for their provisions against possible defaults in loans.
Some UK lawmakers, such as former finance minister Nigel Lawson, want to reinsert a reference to prudence in IFRS rules. The International Accounting Standards Board is discussing that, and such a reference is likely to be reinstated, a senior official involved in the discussion told Reuters.
The issue is divisive; accountants say bookkeeping is meant to be a neutral snapshot rather than make forward-looking judgements.
"I believe the concept of prudence will be very much brought to the fore," Bischoff said in relation to the accounts of banks.
A former top banker, he expects a move to a position where prudence and a true and fair view at a given moment, does include a forward-looking element. (Reporting by Huw Jones; Editing by Larry King)