Mid East SMEs to Benefit from International Accounting Standards Board Proposal
Dubai on 26-30 May, will examine the progress made to date on the International Accounting Standards Board (IASB) draft and the proposed International Financial Reporting Standard (IFRS) for Small and Medium Enterprises (SMES). Experts will also debate the merits of each proposal in a bid to reach a common accord of how to reduce compliance costs and improve consistency, comparability and the quality of financial reporting.
Asad Ali Shah, Council Member for the Institute of Chartered Accountants and Partner at Deloitte Pakistan commented, “The benefits of the IASB’s proposed standard for SMEs, is likely to improve their quality of financial reporting in many jurisdictions. Often the standards that SMEs are currently following may not have been designed with decision- usefulness as the overriding objective.”
The debate comes at a time when the IASB has recently published an exposure draft of an 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, private companies. The full set of IFRS is meant primarily for listed organisations and there is real demand, especially from emerging markets, for a simpler accounting framework.
Asad stated, “Due to the cumbersome detailed nature and complexity of the full set of IFRS, regional finance professionals need to consider whether they should adopt this standard, which is likely to become effective from January 1, 2009. Their alternative is to develop their own SME standard based on the IASB draft that can be implemented earlier.”
Currently in the absence of an SME standard in the Middle East, companies either follow the full set of IFRS or even worse, do not follow any recognised framework of accounting at all. Both conditions are inappropriate, either in the case of full IFRS where it’s very costly to apply or by not complying with any recognised framework which results in unreliable financial statements.
World Accounting Summit is an international, strategic, high-level update on recent developments from the global standards setters, principal advisers and key users of international accounting standards. Insightful contributions will be made from global standard setters such as, Warren McGregor, Board Member, IASB, UK; John Petty, National Vice President and past President (NSW) of the CPA in Australia, member of National CPA Board of Directors, member of Board Audit & Risk Committee; Abbas Ali Mirza, Chairman of the Auditors’ Group of the Dubai Chamber of Commerce & Industry (DCCI) and Roger Adams, Executive Director – Technical, The Association of Chartered Certified Accountants (ACCA), UK amongst others.