It is necessary for businesses to adhere to IFRS in their accounting, as these are based on the principles of comparability, relevance, clarity, reliability and various accounting rules.
Detailing how businesses should report their expenses, income and other transactions establishes a common accounting language, understood by auditors, global investors, government regulators and other parties. The standards aid users of financial statements in comparing financial performance of publicly listed companies irrespective of their location.
The European Union, parts of South America, Asia and over 100 countries globally use IFRS as the official standard of accounting. IFRS is different from the Generally Accepted Accounting Principles (GAAP), used in the United States, In that the IFRS framework is principle-based, allowing for more flexibility and room for interpretation. Read more at Harvard Business Insights.
IFRS in Business Accounting
Why your Business should emphasize on IFRS:
- IFRS maintains corporate transparency, consistency and credibility.
- Aids investors in analyzing company performance and conducting comparisons.
- Enables businesses and investors to make better-informed financial analyses and decisions.
- Inspires investor confidence in credibility of financial statements, which encourages trust and increased transactions.
- Ease of doing business – A common Accounting language enables better interpretation of financial statements across companies locally and globally.
Statements and Basic Reports:
- Cash Flows
- Comprehensive Income
- Financial Position
- Changes in Equity/Retained Earnings
- Summary of Accounting policies
As per IFRS requirements, parent companies with subsidiary businesses, must provide separate account reports.
CTC Can Help You
For Businesses looking to ensure the highest standard of financial statement preparation, whether for tax purposes, auditing, investing and other accounting-related endeavors, CTC Accounting advises implementing IFRS. We value these standards because we value you as a business and strive to equip you with the best accounting know-how relevant to your business needs.