About the IFRS for SMEs
The IFRS for SMEs is a self-contained Standard (less than 300 pages); designed to meet the needs and capabilities of small and medium-sized entities (SMEs), which are estimated to account for over 95 per cent of all companies around the world.
Compared with full IFRSs (and many national GAAPs), the IFRS for SMEs is less complex in a number of ways:
- Topics not relevant for SMEs are omitted. Examples: earnings per share, interim financial reporting and segment reporting.
- Many principles for recognising and measuring assets, liabilities, income and expenses in full IFRSs are simplified. For example, amortise goodwill; expense all borrowing and development costs; cost model for associates and jointly-controlled entities; and undue cost or effort exemptions for specific requirements.
- Significantly fewer disclosures are required (roughly a 90 per cent reduction).
- The Standard has been written in clear, easily translatable language.
- To further reduce the burden for SMEs, revisions are expected to be limited to once every three years.
The Standard is available for any jurisdiction to adopt, whether or not it has adopted full IFRSs. Each jurisdiction must determine which entities should use the Standard. The IASB's only restriction is that listed companies and financial institutions should not use it.
Initial comprehensive review
In May 2015, the IASB completed a comprehensive review of the IFRS for SMEs and made limited amendments to the Standard. The amendments can be found here. A complete revised version of the IFRS for SMEs will be issued in the next few months (Q3 2015).
More information about the comprehensive review is available here.
To assist in implementation, the IFRS Foundation and the IASB have taken a number of steps:
- IFRS for SMEs free to download – The Standard and related implementation guidance are free to download for private, non-commercial use. The IFRS for SMEs is available in more than 25 languages.
- Implementation guidance – The IFRS for SMEs is accompanied by implementation guidance consisting of illustrative financial statements and a presentation and disclosure checklist.
- SME Implementation Group – The SMEIG was established in 2010 to support the international adoption of the IFRS for SMEs and monitor its implementation, develop non-mandatory implementation guidance in the form of Q&As and make recommendations to the IASB on the need to amend the IFRS for SMEs. Learn more about the SMEIG..
- Training material – The IFRS Foundation has developed comprehensive free to download training material to support the implementation of the IFRS for SMEs available in Arabic, English, Russian, Spanish and Turkish. Access the IFRS for SMEs training materials.
- IFRS Taxonomy – The IFRS Taxonomy is the XBRL (eXtensible Business Reporting Language) representation of IFRSs, including the IFRS for SMEs.
- Workshops – The IFRS Foundation holds regional 'train the trainers' workshops, in co-operation with regional professional associations and the world's development agencies, to build capacity for the implementation of the IFRS for SMEs, particularly in developing and emerging economies. Learn more about the workshops.
- Newsletter – We publish a free monthly newsletter, IFRS for SMEs Update, with news about the work of the IASB and the SMEIG, adoptions, resources, and implementation guidance. Access the IFRS for SMEs Updates.
- Presentations – Some presentations about the IFRS for SMEs available for free download. Access the IFRS for SMEs presentations.
- Guidance for micro-sized entities – Click here for more information.