Frequently asked questions about International Financial Reporting Standards (IFRS)
What is IFRS? - IFRS is a set of Accounting standards developed by the IFRS Foundation which is an independent, not-for-profit organization working in the public interest.
What are IASB & FASB? - IASB means the International Accounting Standards Board, which is the independent, accounting standard-setting body of the IFRS Foundation. IASB has 14 Board members who are selected as a group of experts with a mix of experience of standard-setting, preparing and using financial statements together with academic excellence. The IASB was founded on April 1, 2001 as the successor to the International Accounting Standards Committee (IASC). On the other hand, FASB means the Financial Accounting Standards Board which responsible for setting accounting standards for public companies in the U.S. FASB is not directly involved with IFRS but responsible for establishing and improving US GAAP.
What is the difference between IFRS & IAS? - International Accounting Standards Committee (IASC) was responsible for developing International Accounting Standards (IAS) before 2001. IASC was renamed as The International Accounting Standards Board (IASB) in 2001. Consequently the standards issued thereafter are known as IFRS. Therefore all the standards issued after 2001 are IFRS. The previous IAS are still valid but are being gradually superseded by new IFRS.
What is the difference between IFRS Interpretations Committee & Standing Interpretations Committee? - IFRS Interpretations Committee is the committee which makes interpretations on both IAS and IFRS issues. Standing Interpretations Committee (SIC) was the committee which made interpretations on IAS. IFRS Interpretations Committee replaced the former Standing Interpretations Committee (SIC) in March 2002. Interpretations of IFRS Interpretations Committee are known as IFRIC while the Interpretations of the Standing Interpretations Committee (SIC) were known as SIC.
Which countries are using IFRS?- IFRS is used in more than 120 countries including the European Union, India, Australia, Malaysia, Pakistan, Russia, South Africa and Japan. However USA has not yet adopted IFRS.
What are the advantages of IFRS? - Global application of IFRS will make the comparison of financial statements easier for foreign investors which is advantageous for companies to attract investors.