Adoption of Ifrs in Australia - 1101 Words

Internationally, more than 100 countries have adopted International Financial Reporting Standards IFRS or IFRS equivalents, including all EU countries and major Asian countries such as Hong Kong and Singapore which have adopted IFRS almost in their entirety. (KPMG, 2006, pp.11) The adoption of IFRS in Australia through the Australian equivalents of International Financial Reporting Standards (AIFRS) since the beginning of 2005 has reflected how Australia is also part of global momentum for consistency and high quality of financial reporting. Since the formation of International Accounting Standards Committee (IASC) in 1973, we see how accounting standards has become an important issue and an on going public concern. IASC was first†¦show more content†¦E.g. SAC 1 and 2 was not mentioned in IASB thus, Australia has to keep some of its standards as they were missing in the international accounting standards. The main advantages of IFRS include increase capital inflows, higher trade volumes and growth in Australia’s capital markets. (Wayne L, 2005. pp10) As well as the support of international harmonization of accounting standards which shows the rest of the world how Australia is also part of the leading countries such as the EU. In addition, the adoption of IFRS means that it would be easier for businesses to expand both within the region and also around the world. (FRC session 2 background paper, 2005 pp.1) This is because so far over 100 nations have already adopted FIRS reporting standards. But let’s not get over excited about the advantage of adopting IFRS. Arguments against IFRS include the high cost involved for small companies which comprise around 80% of Australian companies. Past experience shows that in attracting international companies to list in Australia in respect has no direct relations in the adoption of IFRS. (Wayne L, 2005. pp11) Also, the logic behind having independent accounting standards is that it allows the AASB to access significant control over the company’s financial reports. The fact the Australian financial reporting regime is required to fully adopt IFRS effectively means that theShow MoreRelatedAdoption of Ifrs in Australia - Essay1932 Words   |  8 PagesStandards (IFRS) are an international set of accounting standards. Early in the 21st century, the Australian Accounting Standards board, with guidance from the Financial Reporting Council (FRC), decided to implement IFRS’s throughout Australia. This decision was made so that Australia could participate and contribute to the development of a distinct set of accounting standards that could be used all around the world. 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