IFRS for SME

Question 1

What are the three main purposes for accounting standards in SME

Answer 1

1) Relevant info
2) Reliable info
3) Useful info

Question 2

Who are the users for accounts of SME?

Answer 2

S/H, Management and Possibly government.

Question 3

Do SME have public accountability?

Answer 3

No

Question 4

How do you define SME?

Answer 4

Although there are no proper definition for SME, SME are defined on size of measures such as number of employees, balance sheet or annual turnover. This is a national setter.

Question 5

What are the differing approaches for IFRS SME?

Answer 5

1) Local GAAP for SME
2) List of SME exemptions in the full IFRS
3) Separate SME standard for each IFRS

Question 6

How does the SME stand now?

Answer 6

1) User friendly
2) Easier Transition to full IFRS
3) Cost Benefit
4) Stewardship not so important
5) Access to capital

CASE U

Question 7

Do we amortise goodwill in SME

Answer 7

Yes

Question 8

How do we treat development and borrowing costs in SME?

Answer 8

Treated as expense

Question 9

Compared with full IFRS, the IFRS for SME are less complex.

True or False

Answer 9

True

Question 10

What following topics are excluded in SME?

Answer 10

1) Earning per share
2) Interim Financial reporting
3) Segment reporting
4) Insurance
5) Assets held for sale

Question 11

How often do we update SME financial reporting compared to full IFRS reporting?

Answer 11

SME FR are updated once every 3 years whereas full IFRS are normally updated every year.