International Financial Reporting Standards

Introduction

The accounting standards developed by International Accounting Standards Board are known as International Financial Reporting Standards. The International Accounting Standards Board (IASB) was established in 2001 as part of the International Accounting Standards Committee (IASC) Foundation.

The objectives of the IASC Foundation and of the IASB are:

a) to develop, a single set of high quality, understandable and enforceable global accounting standards that require high quality, transparent and comparable information in financial statements to help participants in the worlds capital markets
b) to promote the use and rigorous application of those standards

– In fulfilling the objectives associated with (a) and (b), to consider, the special needs of small and medium-sized entities and emerging economies; and
– To bring about convergence of national accounting standards and International Accounting Standards and International Financial Reporting Standards to high quality solutions.

Governing Board:

a) The governance of the IASC Foundation rests with 22 Trustees.
b) The Trustees responsibilities include appointing the members of the IASB and associated councils and committees, as well as securing financing for the organization.
c) The IASB is the standard-setting body of the IASC Foundation. The IASB comprises twelve full-time and two part-time members. The IASB is responsible for approving International Financial Reporting Standards (IFRSs) and related documents, such as the Framework for the Preparation and Presentation of Financial Statements, exposure drafts, discussion documents, and Interpretations of IFRSs.
d) Before the IASB began operations, International Accounting Standards (IASs) and related Interpretations were established by the Board of IASC, which came into existence on 29 June 1973.

International Accounting Standards (IAS) / International Financial Reporting Standards (IFRS):

IAS were issued between 1973 and 2001 by the Board of IASC. In April 2001 the International Accounting Standard Board (IASB) adopted all International accounting Standards (IAS) and continued their development, calling the new standards as International Financial Reporting Standards (IFRS).

By resolution of the IASB, IASs and related Interpretations remain applicable, with the same authority as IFRSs developed by the IASB, unless and until they are amended or withdrawn by the IASB.

IFRS applicability as on 1.1.2016

Total IAS & IFRS applicable as on 1.1.2016 are 41

International scenario:

In recent years, need for international harmonization of Accounting Standards followed in different countries has grown considerably as the cross-border transfers of capital are becoming increasingly common.
Convergence to International Financial Reporting Standards (IFRS) is a much talked about issue in the accounting world today. IFRS are used in many parts of the world, including European Union. Many nations have switched over to IFRS while many others are in the process of converging their national GAAPs to IFRS. Currently 116 countries throughout the world, including the 27 European Union member states, Australia, New Zealand and Russia require or permit the use of International Financial Reporting Standards (IFRS) by adoption or convergence. Further 24 countries have submitted the plans to implement the same.

India has planned to converge to IFRS w.e.f 01.04.2016.

Ind AS applicability as on 1.4.2016

Thus, total Ind AS applicable as on 1.4.2016 are 41