Updating our post from earlier today, the IASB has now published its final standard entitled: IFRS for SMEs. As noted in this FEI Summary, the IASB's definition of SME hinges on whether an entity has 'public accountability,' not a size test. (In simple terms, although reference should be made to the IFRS for SMEs standard for the official definition - I would describe it as a two tier test: first, the entity can have no publicly traded debt or stock, and second, the entity cannot be deemed as having 'public accountability' wherein it it "holds assets in a fiduciary capacity for a broad group of outsiders....which is typically the case for banks, credit unions, insurance companies, securities brokers/dealers, mutual funds and investment banks." Charitable institutions and certain other institutions that hold money in a fiduciary capacity for reasons incidental to their business are not deemed publicly accountable, but once again, refer to the standard for the precise definitions.
The IASB notes that the decision whether to permit use of IFRS for SMEs vs. full IFRS is a jurisdictional decision, and some jurisdictions may apply a size test in this decision, although the IASB's core definition of SME does not use a size test.
Read more about IFRS for SMEs on the IASB website, http://www.iasb.org/ and in the FEI Summary. (Note: this particular FEI summary is available to the public, not only FEI members.)
See also the AICPA's Q&A document on IFRS for SMEs, which notes: "The AICPA's governing Council recognizes the IASB as an accounting body for purposes of establishing international financial accounting and reporting principles. Full IFRS and IFRS for SMEs are not an other comprehensive basis of accounting. Rather, they are generally accepted accounting principles." The AICPA Q&A also includes such questions as: "Why would a private company in the United States choose to prepare its financial statements in accordance with IFRS for SMEs?" and "Does the AICPA Support Use of IFRS for SMEs in the United States?"
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