30 September 2012
More and more instances are coming, especially in banking sector that AGE of the product say finished goods, raw material WIP, debtors... in short current assets as well as current liabilities needs to be understood by the management. That will decide the quality of the assets and liabilities. IFRS knocking the doors of India has a nore vital role so far as age analysis is concerned.
14 July 2024
IFRS stands for International Financial Reporting Standards. It is a set of accounting standards developed by the International Accounting Standards Board (IASB), an independent, private-sector body based in London, UK. IFRS are designed as a common global language for business affairs so that company financial statements are understandable and comparable across international boundaries.
### Key Features of IFRS:
1. **Global Adoption**: IFRS is used by more than 140 countries around the world, including the European Union and many Asian and South American countries. It aims to harmonize accounting standards globally, reducing the complexity and cost of preparing financial statements for international companies.
2. **Principles-based Approach**: IFRS is based on principles rather than strict rules, allowing for flexibility in application while ensuring transparency and comparability. This approach is intended to reflect the economic substance of transactions and events rather than merely their legal form.
3. **Framework and Standards**: IFRS consists of a conceptual framework that sets out the concepts and principles underlying financial reporting, as well as individual standards and interpretations that prescribe how particular types of transactions and other events should be reflected in financial statements.
4. **Benefits**: The adoption of IFRS is believed to enhance transparency and accountability in financial reporting, improve investor confidence, facilitate global capital markets by providing consistent financial information, and reduce the cost of capital for international businesses.
5. **Convergence Efforts**: Many countries, including the United States, have made efforts towards converging their national accounting standards with IFRS. While the US has not fully adopted IFRS, many multinational corporations in the US prepare financial statements in accordance with both US GAAP (Generally Accepted Accounting Principles) and IFRS.
In summary, IFRS represents a significant step towards global harmonization of accounting practices, aiming to improve the quality, comparability, and transparency of financial reporting worldwide.
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