Keywords: Accounting standards, SME, IFRS, ASEAN, Federation of Accounting Professions 'FAP'
At a meeting of the ASEAN Federation of Accountants (‘AFA’), held on 7 December 2009 in Brunei, it was agreed that a set of accounting standards for SMEs be developed.
Thailand’s FAP is to lead the study and develop accounting standards for SMEs and non-listed companies which could be voluntarily adopted by 10 South East Asian countries, namely Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.
As has already been discussed in previous Technical Updates, the International Accounting Standards Board (‘IASB’) has already issued an IFRS for SMEs, but many in the AFA believe it is too complex for many ASEAN SMEs.
It has been suggested that one compromise to balance the needs of SMEs against the intention to improve financial reporting would be to adopt IFRS wholesale and “carve-out” the complex requirements on fair value accounting.
The AFA and FAP are expected to present the formal results of their study at the World Congress of Accountants which will be held in Kuala Lumpur, Malaysia in November 2010.