IFRS stands for International Financial Reporting Standards. These are accounting standards developed and maintained by the International Accounting Standards Board (IASB), which is an independent, private-sector organization based in London, UK. IFRS provides a common language for financial reporting that is used by companies worldwide to provide investors, creditors, and other stakeholders with relevant and reliable financial information.
IFRS sets out principles-based standards for financial reporting, which means that they provide guidance on the principles and concepts that underlie financial reporting, rather than prescribing specific rules or procedures. This allows companies to apply the standards to their unique circumstances, while still meeting the objective of providing transparent and accurate financial information.
IFRS covers a wide range of financial reporting topics, including:
Presentation of financial statements
Revenue recognition
Accounting for assets and liabilities
Financial instruments
Business combinations
Leases
Disclosure requirements
IFRS is used by companies in over 100 countries around the world, including in the European Union, Australia, Canada, and many other countries. Its adoption has led to increased transparency and comparability in financial reporting, making it easier for investors and other stakeholders to assess the financial performance and position of companies operating in different markets.
