New international financial reporting standards to facilitate growth of small business in UAE
The introduction of International Financial Reporting Standards (IFRS) for small and medium-sized enterprises, a global initiative to unify and streamline financial reporting for small businesses, will facilitate the further growth of the SME sector in the UAE, according to Grant Thornton, one of the world's leading independently owned accounting and consulting firms.
Currently accounting for more than 85 per cent of all businesses in the UAE and representing over 95 per cent of all global businesses, SMEs represent the primary driver of job creation and growth in the country, Raza Meghji, Partner, Grant Thornton UAE, pointed out at the IFRS conference organised by the Institute for International Research and held from March 14-17, 2010, in Dubai.
“Worldwide, the single greatest challenge facing small and medium enterprises is access to finance, a problem that has only been exacerbated by the global financial crisis and correspondingly tighter credit conditions,” Meghji said. “By adopting IFRS for SMEs, however, small businesses in the UAE will be able to provide potential lenders and investors with credible, standardised and transparent financial records, facilitating the extension of credit and benefiting the long-term diversification and stability of the domestic economy.”
Meghji added: “With the announcement of the SME Development Roadmap by the Mohammed Bin Rashid Establishment for SME Development in December 2009 and the definition for SMEs now in place, the new IFRS for SMEs provides clear benefits for investors, lenders and those seeking to raise finance.”