|Extent of IFRS application||Status||Additional Information|
|IFRS Standards are required for domestic public companies||All domestic listed companies, financial institutions, and some others are required to use Sri Lanka Financial Reporting Standards, which are IFRS Standards with some modifications.|
|IFRS Standards are permitted but not required for domestic public companies|
|IFRS Standards are required or permitted for listings by foreign companies||Sri Lanka Financial Reporting Standards (which are IFRS Standards with some modifications) are required.|
|The IFRS for SMEs Standard is required or permitted||Permitted.|
|The IFRS for SMEs Standard is under consideration|
The Sri Lanka Accounting and Auditing Standards Act No. 15 of 1995 defines a class of companies as Specified Business Enterprises (SBEs). SBEs include:
All SBEs (other than those in item 12 above) are required to use full SLFRS even if their securities do not trade in a public market. The companies listed under the item no: 12 have the option to apply full SLFRSs or the SLFRS for SMEs.
Other than the above SBEs, companies are given the option to adopt full SLFRSs or the SLFRS for SMEs.
CA Sri Lanka exposes for public comment all exposure drafts of new or amended IFRS Standards and draft interpretations. CA Sri Lanka also conducts CFOs’ round table discussions to identify the impact of the proposed standard in Sri Lanka. Afterwards, CA Sri Lanka forwards its views to the Board.
When the Board issues a final IFRS Standard or Interpretation, CA Sri Lanka reviews the IFRS Standard and related technical materials. In a few cases this review has resulted in modification or deferral of the standard for use in Sri Lanka.
Thereafter, the standard is translated into Sinhala and Tamil and published in the Extra Ordinary Gazette as required by the Accounting and Auditing Standards Act No: 15 of 1995 in Sri Lanka. Once gazetted, the standard becomes legally authoritative.
Sri Lanka Financial Reporting Standards comprise not only IAS Standards, IFRS Standards, and IFRIC and SIC Interpretations, but also:
In adopting IFRS 7 Financial Instruments: Disclosures as Sri Lanka Financial Reporting Standard (SLFRS) 7, Sri Lanka did not require comparative information for periods beginning before 1 January 2013. IFRS 7 would require such information. This was transitional relief rather than a modification of IFRS 7.
Sri Lanka has adopted an alternative treatment with respect to some right of use land on lease.
Sri Lanka has adopted an alternative treatment with respect to accounting for a new ‘super gain tax’ that is required by Sri Lankan law but that is inconsistent with paragraph 46 of IAS 12 Income Taxes.