The International Accounting Standards Board (IASB) is today publishing for public comment the Exposure Draft of its International Financial Reporting Standard for Small and Medium-sized Entities ( IFRS for SMEs ).
The aim of the proposed standard is to provide a simplified, self-contained set of accounting principles that are appropriate for smaller, non-listed companies and are based on full International Financial Reporting Standards (IFRSs), developed primarily for listed companies. By removing choices for accounting treatment, eliminating topics that are not generally relevant to SMEs and simplifying methods for recognition and measurement, the resulting draft standard reduces the volume of accounting guidance applicable to SMEs by more than 85 per cent when compared with the full set of IFRSs. As a result, the Exposure Draft offers a workable, self-contained set of accounting standards that would allow investors for the first time to compare SMEs’ financial performance across international boundaries on a like for like basis.
In order to assist companies in preparing accounts based on the proposed IFRS for SMEs , the requirements of IFRSs have been simplified and redrafted using plain English where possible. However, SMEs that decide to upgrade to using full IFRSs would find the transition eased because both sets of standards are based on the same underlying principles.
See full Press Release.
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