INDEX.

Sr no. Particulars Page no.

1 Introduction
1.1 IFRS 1
1.2 IAS 4
1.3 Features of IFRS 8
1.4 Objectives of IFRS 9
1.5 Importance of IFRS 11
1.6 Types of IFRS 12
1.7 Functions of IASB 18
1.8 IAS 34 20
2 RESEARCH METHODOLOGY
2.1 Objectives 27
2.2 Hypothesis 27
2.3 Scope and duration of the study 27
2.4 Limitations of the study 27
2.5 Significance of the study 28
2.6 Nature of the problem 28
2.7 Sample size and data collection 28
2.8 Outline of the study 29
3 LITERATURE REVIEW
3.1 Introduction 30
3.2 Quality of interim 30
3.3 Relevance 35
3.4 Reliability 36
3.5 Timeliness 38
4 DATA ANALYSIS, INTERPRETATION 68
AND PRESENTATION
5 CONCLUSION AND SUGGESTIONS 79
Bibliography 80
1. Introduction
1.1 International Financial Reporting Standards (IFRS)

International Financial Reporting Standards (IFRS) set common rules so that financial
statements can be consistent, transparent and comparable around the world. IFRS are issued
by the International Accounting Standards Board (IASB). They specify how companies must
maintain and report their accounts, defining types of transactions and other events with
financial impact. IFRS were established to create a common accounting language, so that
business and their financial statements can be consistent and reliable from company and
country and country.

IFRS are designed to bring consistency to accounting language, practices and statements, and
to help businesses and investors make educated financial analyses and decisions. THE IFRS
FOUNDATION sets the standards to “bring transparency, accountability and efficiency to
financial markets around the world…fostering trust, growth and long-term financial stability
in the global economy”. Companies benefit from the IFRS because investors are more likely
to put money into a company if the company’s business practices are transparent.

The U.S. Securities and Exchange Commission (SEC) has said it won’t switch to
International Financial Reporting Standards, but will continue reviewing a proposal to allow
IFRS information to supplement U.S. financial filings. GAAP has been called “the gold
standard” of accounting. However, some argue that global adoption of IFRS would save
money on duplicative accounting work, and the costs of analysing and comparing companies
internationally.

IFRS are sometimes confused with International Accounting Standards (IAS), which are the
older standards that IFRS replaced. IAS was issued from 1973 to 2000, and the International
Accounting Standards Board (IASB) replaced the International Accounting Standards
Committee (IASC) in 2001.

Standard IFRS Requirements

1
IFRS covers a wide range of accounting activities. There are certain aspects of business
practice for which IFRS set mandatory rules.

 Statement of Financial Position:

This is also known as a balance sheet. IFRS influences the ways in which the
components of a balance sheet are reported.
 Statement of Comprehensive Income:
This can take the form of one statement, or it can be separated into a profit and loss
statement and a statement of other income, including property and equipment.
 Statement of changes in Equity:
Also known as a statement of retained earnings, this documents the company’s change in
earnings or profit for the given financial period.

 Statement of Cash Flow:

This report summarizes the company’s financial transactions in the given period,
separating cash flow into Operations, Investing and Financing.
In addition to these basic reports, a company must also give a summary of its accounting
policies. The full report, to show the changes in profit and loss. A parent company must
create separate account reports for each of its subsidiary companies.

IFRS vs American Standards

Differences exist between IFRS and other countries Generally Accepted Accounting
Principles (GAAP) that affect the way a financial ratio is calculated. For example, IFRS is
not as strict on defining revenue and allow companies to report revenue sooner, so
consequently, a balance sheet under this system might show a higher stream of revenue than
GAAP’s. IFRS also has different requirements for expenses; for example, if a company is
spending money on development or an investment for the future, it doesn’t necessarily have
to be reported as an expense (it can be capitalized).
Another difference between IFRS and GAAP is the specification of the way inventory is
accounted for. There are two ways to keep track of this., first in first out (FIFO) and last in
first out (LIFO). FIFO means that the most recent inventory is left unsold until older
inventory is sold; LIFO means that the most recent inventory is the first to be sold. IFRS
prohibits LIFO, while American standards and others allow participants to freely use either.

2
Key Takeaways:

 IFRS were established to create a common accounting language, so business and

accounts can be understood from company and country to country.
 Both companies and investors benefit from IFRS because people are more confident
investing in a company if its business practices are transparent and reliable.
 The IFRS are set by the International Accounting Standards Board, an independent
body of the IFRS Foundation, which provide updates, insights and guidance on the
standards.

The IFRS Foundation is a non-profit, public interest organisation established to develop a

single set of high-quality, understandable, enforceable and globally accepted accounting
standards-IFRS Standards- and to promote and facilitate adoption of the standards.

IFRS Standards are set by the IFRS Foundation’s standard setting body, the International
Accounting Standards Board.

The IFRS Foundation has a three tier governance structure, based on an independent standard
setting Board of experts (International Accounting Standards Board), governed and overseen
by Trustees from around the world (IFRS Foundation Trustees) who in turn are accountable
to a monitoring board of public authorities (IFRS Foundation Monitoring Board).

The IFRS Advisory Council provides advice and counsel to the Trustees and the Board,
whilst the Board also consults extensively with a range of other standing advisory bodies and
consultative groups.

 Public accountability:
The Monitoring Board is a group of capital market authorities and provides a formal
link between the Trustees and public authorities in order to enhance the public
accountability of the IFRS Foundation.
 Governance:
The Trustees of the IFRS Foundation are responsible for the governance and oversight

3
 of the International Accounting Standards Board, including the Constitution and due
process for the development of the accounting standards.
 Independent standard setting:
The International Accounting Standards Board (Board) is the independent standard
setting body of the IFRS Foundation.
 IFRS Interpretations Committee:
The interpretative body of the International Accounting Standards Board (Board),
which works with the Board in supporting the application of IFRS Standards.

IFRS Advisory Council

The advisory council is the formal advisory body of the International Accounting Standards
Board (Board) and the Trustees of the IFRS Foundation. It consists of a wide range of
representatives, comprising individuals and organisations with an interest in international
financial reporting.

1.2 International Accounting Standards (IAS)

International Accounting Standards (IAS) are older accounting standards which were
replaced in 2001 by International Financial Reporting Standards (IFRS), issued by the
International Accounting Standards Board (IASB), an independent international standard
setting body based in London.

International Accounting Standards (IAS) were the first international accounting standards
that were issued by the International Accounting Standards Committee (IASC), formed in
1973. The goal then, as it remains today, was to make it easier to compare business around
the world, increase transparency and trust in financial reporting and foster global trading and
investment.

Benefits of International Accounting Standards:

Globally comparable accounting standards promote transparency, accountability and

4
efficiency in financial markets around the world. This enables investors and other market
participants to make informed economic decisions about investment opportunities and risks,
and improves capital allocation. Universal standards also significantly reduce reporting and
regulatory costs, especially for companies with international operations and subsidiaries in
multiple countries.

There has been significant progress towards developing a single set of high-quality global
accounting standards since the IASC was replaced by the IASB. IFRS have been adopted by
the European Union, leaving the U.S., Japan (where voluntary adoption is allowed) and
China (which says it is working towards IFRS) as the only major capital markets without an
IFRS mandate. As of 2018, 144 jurisdictions require the use of IFRS standards for all or most
publicly listed companies, and a further 12 jurisdictions permit its use.

The U.S. is exploring adopting international accounting standards. Since 2002, America’s
accounting-standards body, the Financial Accounting Standards Board (FASB) and the IASB
have been collaborating on a project to improve and convergence process is taking much
longer than was expected – in part because of the complexity of implementing the Dodd-
Frank Wall Street Reform and Consumer Protection Act.

The Purpose of International Accounting Standards in Accounting

The purpose of these standards is to ensure that the financial centres of the world, which have
become more interconnected than ever, can use a global financial reporting framework that
ensures effective regulation of financial markets. The growing volume of cross border capital
flows makes having international standards, that are high in quality and testable across the
board, a priority. By having these standards in place, capital markets that are located in
different jurisdictions can create the most efficient capital flows that are beneficial to
regulators, organizations, and the market as a whole.

Until recently, the International Accounting Standards (IAS) were created and issued by the
Board of the International Accounting Standards Committee (IASC). These standards were
put in place to advise companies how to report financial events in a financial statement. In

5
2001, a new set of standards was developed and these new standards was developed and these
new standards are referred to as the International Financial Reporting Standards (IFRS). The
IFRS were issued by the International Accounting Standards Board (IASB), which ultimately
has no authority over whether or not a company adopts the standards. While this is true, many
countries have financial laws requiring all publicly investors, stakeholders and creditors. The
IFRS are currently not being adopted in the US, which has led to a lot of criticism.

There are three different editions of the standards that are printed today. The first edition was
the Red Book, which is the original set of standards that has not been superseded or replaced.
While this version is still published, it does not contain some updated information. The Blue
Book, printed in 2010, consolidates standards that were put in place before January 1 of that
year. The Green Book, which is the latest version to be printed, consolidates all of the current
standards. It is important to also have current interpretations of these standards.

In a global environment it is important to have a global set of standards that can be adopted
and used by every country. This makes the framework much more reliable and consistent.
While the US currently adopts the GAAP standards that were created by the Federal
Accounting Standards Board, some companies that operate on a multi-national level have
adopted international standards. The worldwide adoption of the IFRS will make the reading
and analysis of financial statements much easier for all investors. While the international
accounting standards are not used by all listed and unlisted companies, more and more
countries are making adoption a priority.

Benefits of International Accounting Standards (IAS):

If you own a small business in the U.S. that is privately held but sells goods and services and
Exchange Commission doesn’t require your company to adhere to the generally accepted
accounting principles in financial reporting. The SEC only requires that U.S. domestic
companies that are listed companies need to use GAAP in financial reporting. However, as
the owner of a privately held business that understands the scope and importance of
international accounting, you can voluntarily comply with the International Accounting
Standards Board. The IASB has created International Financial Reporting Standards to
facilitate business across borders. To understand the benefits of accounting standards, it is

6
necessary to first understand the benefits of accounting standards as they apply to your small
business.

Facilitates Ethics Compliance:

In a utopia, every business in the world would operate with a firm standard of behaviour that
customers could admire but the world isn’t perfect, and neither is the ethics employed by
some company owners. This speaks to the importance of international accounting standards
because countries around the world have different cultures and practices. For example, in
some developing countries, paying others bribes and providing financial incentives is an
accepted way of doing business. In other countries, however, even the hint of this kind of
impropriety can lead to fines and even a jail sentence. The importance of international
accounting standards in these cases can’t be overstated. By having a uniform code of
accounting standards, it evens the playing field and allows business owners in different parts
of the world to adhere to the same guidelines. One of the other benefits of accounting
standards at the international level as it relates to ethics is that they often include suggestions
from accounting professionals throughout the world. This helps to ensure that these standards
aren’t favourable to one country or culture over another.

Improves International Investment:

You can’t talk about the scope and importance of international accounting without
mentioning the benefits of accounting standards when it comes to investment. Investors and
other stakeholders find it more convenient to compare their business performance with other
international companies. This makes it easier and cheaper for them to raise business capital
from investors across the globe. The IASB allows you to review financial documents from
foreign companies that you may want to invest in or at least establish relations with because
you are all working under the same set of accounting principles. That means that regardless
of where the foreign company is based, you will have reliable accounting information that
was prepared using uniform methods. This eliminates a great deal of uncertainty when it
comes to making a financial decision about whether or not that company’s financial status is
solid enough to merit your investment.

Sets Generalized Standards:

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The IFRS stipulations are flexible enough to account for expected and unexpected changes in
the global business environment because they are based on broad principles. With the rapid
evolution of ecommerce, the opportunities for business around the globe to work with each
other have never been greater. As a result, the scope and importance of international

accounting necessitates general standards that are applicable and accommodative to varying
jurisdiction circumstances and traditions, with minimal IASB intervention. For example, the
IASB does not recommend any specific formats for preparing financial statements. This gives
business owners the freedom and discretion to choose the presentation format that best
express their financial status. Using IFRS frees a business from the restrictive scope of
national level accounting standards. Financial reports become automatically acceptable in
IFRS compliant countries, and companies don’t need to prepare alternative sets of financial
statements when pursuing business interests in these countries.

1.3 Features of IFRS

IFRS financial statements come in various shapes and sizes, but they all have certain features
in common. Information in IFRS financial statements has these characteristics:

 Relevance:
So that it makes a difference to the decisions about a company made by users of the
statements.
 Faithful representation:
Financial statements are complete and free from bias and error.
 Comparability:
You can compare financial statements from one period to the next or for two
companies in the same industry so that you can make informed decisions about the
companies.
 Verifiability:
Different people could reach the same decision based on the information, but not
necessary each complete agreement.

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  Timeliness:
You make information available to users in good time. Historical information quickly
becomes out of date.
 Understand ability:
You present and classify information clearly and concisely to make it understandable
to users.
 Transparency:
IFRS Standards bring transparency by enhancing the international comparability and
quality of financial information, enabling investors and other market participants to
make informed economic decisions.
 Accountability:
IFRS Standards strengthen accountability by reducing the information gap between
the providers of capital and the people to whom they have entrusted their money. Our
Standards provide information needed to hold management to account. As a source of
globally comparable information, IFRS Standards are also of vital information to
regulators around the world.
 Efficiency:
IFRS Standards contribute to economic efficiency by helping investors to identify
opportunities and risks across the world, thus improving capital allocation. Use of a
single, trusted accounting language lowers the cost of capital and reduces
international reporting costs for businesses.

1.4 Objectives of International Financial Reporting Standards (IFRS)

According to International Accounting Standard Board (IASB), the objective of financial

reporting is “to provide information about the financial position, performance and changes in
financial position of an enterprise that is useful to a wide range of users in making economic
decisions.”

The following points sum up the objectives and purposes of financial reporting:

 Providing information to management of an organization which is used for the

9
 purpose of planning, analysis, benchmarking and decision making.
 Providing information to investors, promoters, debt provider and creditors which is
used to enable them to male rational and prudent decisions regarding investment,
credit etc.
 Providing information about the economic resources of an organization, claims to
those resources (liabilities and owner’s equity) and how these resources and claims
have undergone change over a period of time.
 Providing information to shareholders and public at large in case of listed companies
about various aspects of an organization.
 Providing information as to how an organization is procuring and using various
resources.
 Providing information to various stakeholders regarding performance management of
an organization as to how diligently and ethically they are discharging their fiduciary
duties and responsibilities.
 Providing information to the statutory auditors which in turn facilitates audit.
 Enhancing social welfare by looking into the interest of employees, trade union and
government.
 To develop, in the public interest, a single set of high quality, understandable and
enforceable global accounting standards that require high quality, transparent and
comparable information in financial statements and other financial reporting to help
participants in the world’s capital markets and other users make economic decisions.
 To promote the use and rigorous application of those standards
 In fulfilling the objectives associated with (1) and (2), to take account of, as
appropriate, the special needs of small and medium sized entities and emerging
economics.
 To bring about convergence of national accounting standards and International
Accounting standards and IFRS to high quality solutions.
 It is transparent for users and comparable over all the periods presented.
 Provides a suitable starting point for accounting under International Financial
Reporting Standards (IFRS).

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1.5 Importance of IFRS

The importance of financial reporting cannot be over emphasized. It is required by each and
every stakeholder for multiple reasons and purposes. The following points highlights why
financial reporting framework is important: -

 In helps and organization to comply with various statues and regulatory requirements.
The organizations are required to file financial statements to ROC, Government
Agencies. In case of listed companies, quarterly as well as annual results are required
to be filed to stock exchanges and published.
 It facilitates statutory audit. The statutory auditors are required to audit the financial
statements of an organization to express their opinion.
 Financial Reports forms backbone for financial planning, analysis, bench marking and
decision making. These are used for above purposes by various stakeholders.
 Financial reporting helps organizations to raise capital both domestic as well as
overseas.
 On the basis of financials, the public in large can analyse the performance of the
organization as well as of its management.
 For the purpose of bidding, labour contract, government supplies etc., organizations
are required to furnish their financial reports and statements.
 It benefits the economy by increasing the growth of its international business.
 By encouraging the international investors to invest, it leads to more foreign capital
flows to the country.
 Financial statements prepared using a common set of accounting standards help
investors better understand investment opportunities as opposed to financial
statements prepared using a different set of national accounting standards.
 It offers accounting professionals more opportunities in any part of the world if same
accounting practices prevail throughout the world.

Conclusion: -

So we can conclude from the above points that financial reporting is very important from
various stakeholder’s point of view. At times large organizations it becomes very complex

11
but the benefits are far more than such complexities. We can say that financial reporting
contains reliable and relevant information which are used by multiple stakeholders for
various purposes. A sound and robust financial reporting system across industries promotes
good competition and also facilitates capital inflows. This in turn helps in economic
development.

1.6 Types of IFRS

This is a list of the International Financial Reporting Standards (IFRSs) and official
interpretations, as set out by the IFRS Foundation. It includes accounting standards either
developed or adopted by the International Accounting Standards Board (IASB), the standard
setting body of the IFRS Foundation.

The IFRS include

 International Financial Reporting Standards (IFRSs)- developed by the IASB;

 International Accounting Standards (IASs)- adopted by the IASB;
 Interpretations originated from the International Financial Reporting Interpretations
Committee (IFRICs); and
 Standing Interpretations Committee (SICs).

The list contains all standards and interpretations regardless whether they have been
suspended.

N Title Originally Effective Fully Superseded

Issued withdrawn by
SIC 1 Consistency 1997 January 1, January 1, IAS 2
different cost 2005 2005
formulas for
inventories
SIC 2 Consistency 1997 January 1, January 1, IAS 8
capitalisation of 1998 2005
borrowing costs
SIC 3 Elimination of 1997 January 1, January 1, IAS 28
unrealised profits 1998 2005
and losses on
transactions with
associates

12
SIC 5 Classification of 1997 June 1, 1998 January 1, IAS 32
financial 2005
instruments
contingent
settlement
provisions
SIC 6 Costs of 1997 June 1, 1998 January 1, IAS 16
modifying 2005
existing software
SIC 7 Introduction of the 1997 June 1, 1998
euro
SIC 8 First time 1998 August 1, 1998 January 1, IFRS 1
application of 2004
IASs as the
primary basis of
accounting
SIC 9 Business 1998 August 1, 1998 April 1, 2004 IFRS 3
combinations
classification
either as
acquisitions or
uniting of interest
SIC 10 Government 1998 August 1, 1998
assistance-no
specific relation to
operating
activities
SIC 11 Foreign exchange 1998 August 1, 1998 January 1, IAS 21
capitalisation of 2005
losses resulting
from severe
currency
devaluations
SIC 12 Consolidated 1998 July 1, 1999 January 1, IFRS 10
special purpose 2013
entities

SIC 13 Jointly controlled 1998 January 1, 1999 January 1, IFRS 10

entities non- 2013
monetary
contributions by
ventures

13
SIC 14 Property, plant 1998 July 1, 1999 January 1, IAS 16
and equipment – 2005
compensation for
the impairment or
loss of items
SIC 15 Operating leases - 1998 January 1, 1999
incentives
SIC 16 Share capital – 1998 July 1, 1999 January 1, IAS 32
reacquired own 2005
equity instruments
( treasury shares )
SIC 17 Equity – costs of 1999 January 30, January 1, IAS 32
an equity 2000 2005
transaction
SIC 18 Consistency – 1999 July 1, 2000 January 1, IAS 8
alternative 2005
methods
SIC 19 Reporting 2000 January 1, 2001 January 1, IAS 21
currency – 2005
measurement and
presentation of
financial
statements under
IAS 21 and IAS
29
SIC 20 Equity accounting 1999 July 15, 2000 January 1, IAS 28
method 2005
recognition of
losses
SIC 21 Income taxes – 1999 July 15, 200 January 1, IAS 12
recovery of 2012
revalued non –
depreciable assets

SIC 22 Business 1999 July 15, 2000 April 1, 2004 IFRS 3

combinations
subsequent
adjustment of fair
values and
goodwill initially
reported
SIC 23 Property, plant 1999 July 15, 2000 January 1, IAS 16
and equipment – 2005
major inspection
or overhaul costs

14
SIC 24 Earnings per share 2000 December 1, January 1, IAS 33
– financial 2000 2005
instruments and
other contracts
that may be
settled in shares
SIC 25 Income taxes – 1999 July 15,
changes in the tax 2000
status of an entity
or its shareholders
SIC 26 Draft only – not N/A N/A N/A IAS 16
issued: property,
plant and
equipment –
results of
incidental
operations
SIC 27 Evaluating the 2000 January 1,
substance of 2002
transactions
involving the legal
form of a lease
SIC 28 Business 2001 December April 1, 2004 IFRS 3
combinations – 31, 2001
“date of
exchange” and
fair value of
equity instruments
SIC 29 Disclosure – 2001 January 1,
service concession 2002
arrangements
SIC 30 Reporting 2001 January 1, January 1, IAS 21
currency – 2002 2005
translation from
measurement
currency to
presentation
currency
SIC 31 Revenue – barter 2001 January 1,
transactions 2002
involving
advertising
services
SIC 32 Intangible assets – 2001 March 25,
web site costs 2002

15
SIC 33 Consolidation and 2001 January 1, January 1, IAS 27 and
equity method – 2002 2005 IAS 28
potential voting
rights and
allocation of
ownership
interests
IFRIC Changes in 2004 September 1,
1 existing 2004
decommissioning,
restoration and
similar liabilities
IFRIC Members’ shares 2004 January 1,
2 in co-operative 2005
entities and
similar
instruments
IFRIC Emission rights 2004 March 1, July 1, 2005 N/A
3 2005
IFRIC Determining 2004 January 1,
4 whether an 2006
arrangement
contains a lease
IFRIC Rights to interests 2004 January 1,
5 arising from 2006
decommissioning,
restoration and
environmental
rehabilitation
funds
IFRIC Liabilities arising 2005 December 1,
6 from participating 2005
in a specific
market – waste
electronic
equipment

IFRIC Approach under 2005 March 1,

7 IAS 29 financial 2006
reporting in
hyperinflationary
economies

16
IFRIC Scope of IFRS 2 2006 May 1, 2006 January 1, IFRS 2
8 2010
IFRIC Reassessment of 2006 June 1, 2006
9 embedded
derivatives
IFRIC Interim financial 2006 November 1,
10 reporting and 2006
impairment
IFRIC IFRS 2 – group 2006 March 1, January 1, IFRS 2
11 and treasury share 2007 2010
transactions
IFRIC Service 2006 January 1,
12 concession 2008
arrangements
IFRIC Customer loyalty 2007 January 1,
13 programmes 2008
IFRIC IAS 19 – the limit 2007 January 1,
14 on a defined 2008
benefit asset,
minimum funding
requirements and
their interaction
IFRIC Agreements for 2008 January 1,
15 the construction of 2009
real estate

IFRIC Hedges of a net 2008 October 1,

16 investment in a 2008
foreign
investment
IFRIC Distributions of 2008 July 1, 2009
17 non-cash assets
IFRIC Transfers of assets 2009 July 1, 2009
18 from customers
IFRIC Extinguishing 2009 July 1, 2010
19 financial liabilities
with equity
instruments
IFRIC Stripping costs in 2011 January 1,
20 the production 2013
phase of a surface
mine
IFRIC Levies 2013 January 1,
21 2014

17
 IFRIC Foreign currency 2016 January 1,
22 transactions and 2018
advance
considerations
IFRIC Uncertainty over 2017 January 1,
23 income tax 2019
treatments

1.7 Functions of IASB

Introduction:

International Accounting Standard Board (IASB) is an independent, private sector body

(previously known as IASC), based in London. IASB is committed to develop and approve a
single set of global accounting standards (that is known as International Financial Reporting
Standards), which require transparent and comparable information in general purpose of
financial statements.

The IASB arrogated its privately funded accounting standard setting responsibility for the
establishment a single set of global accounting standard (i.e. IFRS). 1 st April 2001 from
IASC, adopting all International Accounting Standards (IASs) and special interpretation
committee in existence.

Functions of IASB:

The IASB provides support and co-operation to the European Union and the International
Organisation of Security Commission. The purposes of the conceptual framework of IASB
are such as:

 Assist the board of IASB in developments of future International Financial Reporting

Standard (IFRS) and the review of its existing IFRSs;
 Assist the board of directors in promoting the concept harmonisations of regulations,
Accounting Standard, procedures and methods relating to presentation of financial
statements by reducing the number of alternative accounting treatments permitted by
IFRS;

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  Assist the financial statements prepares to apply IFRS while preparing the financial
statements;
 Assist the National Standard setting committees in the developing the National
Standards;
 Assist the auditors provide an opinion relating to financial statements whether IFRS
guideline has complied while preparing the financial statements or not;
 Assist the users (investors, creditors, suppliers, employees, etc.) of the financial
statements in interpreting the information contained in the financial statements in
interpreting the information contained in the financial statements in interpreting the
information contained in the financial statements prepared in compliance with IFRSs
as well as provide those who interested in the work of IASB about its approach to the
formulations of IFRSs.

The primary functions of the IASB are as follows: -

Development and Creation of Global Accounting Standards

The primary purpose of the IASB is to develop a single set of high quality, understandable
and enforcement accounting standard that require high quality, transparent and comparable
information in financial statements as well as in other financial reporting to help users of the
financial statements to participate in the world’s capital market and to make economic
decisions.

Enforcement of Standards

The IASB committee has the power to enforce the organisation to comply with accounting
standard that promotes the use and rigorous applications of those standards.

Systematic and in-depth research on enterprise

The function of International Accounting Standard Board does in-depth research of special
needs of small and medium sized enterprise and emerging the economies in fulfilling the
objective of harmonisation of an accounting standard.

Active convergence of Accounting Standards

The objectives of the IASB bring about the convergence of National accounting standard and

19