The International Standards Board (IASB) has issued a major update to the IFRS for SMEs accounting standard.
The aim of the standard is to balance the needs of lenders and other users of SMEs’ financial statements with the resources available to SMEs.
The standard defines SMEs as entities without public accountability that prepare general purpose financial statements.
Highlights of the update include:
- A revised model for revenue recognition.
- Bringing together the requirements for fair value measurement in a single location.
- Updating the requirements for business combinations, consolidations, and financial instruments.
IASB chair, Andreas Barckow, said: “The update to the IFRS for SMEs Accounting Standard will improve the information provided to users of SMEs’ financial statements while maintaining the simplicity of the Standard.”
The changes are effective for annual periods beginning on or after 1 January 2027, with early application permitted.
The IFRS for SMEs Accounting Standard was issued in 2009 to address the global demand for a simplified Accounting Standard for SMEs. This updated version is the third edition of the Standard.
