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Finance & Accounting
Pages 10 (2510 words)
International Financial Reporting Standard for Small and Medium Entities: Reasons and Considerations for Adoption Introduction The globalisation of businesses and merging of economies led to the intermingling of business operations and practices. But in order for businesses from various locations or countries and industries conduct a relationship with one another, it is important that a certain financial understanding fully comprehended by both or all ends is established.
In the fast-evolving business environment brought about by the recent advances in information and communication technologies, transportation, and others, conducting business have also changed. Requirements and understandings need to be ready, clear, and acceptable for all of those conducting business due to various factors such as internet connectivity that allows transfer of funds from one point of the globe to another in a matter of seconds, purchase and sales of high-end to low-end products at the click of the mouse, and the various automations that have increased organizational efficiencies in business operations. With this premise, this paper will explore the reasons for the introduction of the International Financial Reporting Standard for Small and Medium Entities by the International Accounting Standards Board and provide the adjustments and clarifications that SMEs need to consider in adopting the proposed IFRS. Discussion 1. Reasons why the standard was introduced & other options the IASB considered before a standalone standard was developed. ...
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