International Financial Reporting Standards (IFRS) are now the de facto global language for financial reporting, according to the latest findings from the IFRS Foundation research into their use in 122 countries around the world.
The IFRS Foundation has completed the third phase of its project to study jurisdictional adoption of IFRS which involved analysis of developments in an additional 41 countries, bringing the total number of countries surveyed to 122. As a result, the Foundation says there is 'solid evidence' of substantial progress towards global adoption of the standards.
The research provides a profile describing each jurisdiction's decisions regarding use of IFRSs; for instance, which companies, which types of financial statements, and whether IFRS is required or permitted. The profiles explain whether the jurisdiction made any modifications to IFRSs, the wording in the auditor's report, and the nature of each jurisdiction's process for adopting or endorsing IFRSs under local law or regulations.
The IFRS Foundation says the results from all 122 jurisdiction profiles show that nearly all of them have made a public commitment to global accounting standards and to IFRS as those global standards.
IFRS is already required for all or most domestic listed companies in 101 (83%) of the 122 jurisdictions, while most of the remainder already permit IFRS for at least some listed companies.
Around 60% of the 101 jurisdictions that have adopted IFRS for listed companies have extended that requirement to unlisted financial institutions and/or large unlisted companies, and around 90% of these jurisdictions also require or permit IFRS for unlisted companies.
In addition, 57 of the 122 jurisdictions require or permit the IFRS for SMEs, and another 16 are actively considering it. The research indicates that modifications to IFRS are rare and, in most cases, temporary and limited in applicability.
Michel Prada, chairman of the IFRS Foundation trustees said: 'The vision of global accounting standards has been publicly supported by almost all international organisations, including the G20, World Bank, IMF, Basel Committee, IOSCO and IFAC. Twelve years after the reform of the IASC and the establishment of the IFRS Foundation and the IASB, we now have firm evidence of that vision now becoming a reality.'
The jurisdiction profiles were prepared by the IFRS Foundation under the direction of former IASB member Paul Pacter and are drafted on the basis of data provided by standard-setters and other relevant bodies in response to a survey.
