Understanding IFRS – why they arecrucial for your business?
International Financial Reporting Standards (IFRS), developed by the International Accounting Standards Board IASB represents a comprehensive framework of principles and guidelines for financial reporting on a global scale.
Their primary aim is to standardise and enhance the quality of financial reporting, facilitating the comparison of financial data across diverse entities worldwide.
While the European Union mandates the use of IFRS for listed entities, an increasing number of companies not subject to this requirement are opting/choosing to adopt IFRS, as permitted by the Accounting Act.
Benefits of implementing IFRS in a company
International Financial Reporting Standards (IFRS) offers several advantages for businesses:
- IFRS ensures the consistency and uniformity of the data contained in financial statements, thus enhancing the comparability and reliability
- It promotes transparency by obliging IFRS adopters to disclose business-relevant information business information in their financial statements
- Adoption of IFRS facilitates International business operations by encouraging collaboration and standardisation across borders
- IFRS helps to mitigate the legal risks associated with inaccurate or non-compliant preparation of financial statements
- IFRS positively impacts management processes in your company by enabling precise data analysis
- It contributes to increased operational efficiency by optimising company processes
Benefits of professional IFRS implementation
- At SWGK, we will ensure comprehensive implementation of IFRS. This includes transforming the financial statements previously prepared in accordance with the Accounting Act and the National Accounting Standards (NAS), drawing up an accounting policy following IFRS and analysing your company’s IT system
- Our approach takes into account the specific nature of your company
- Once the implementation of IFRS is complete, we provide support to further optimise your company’s processes
Accurate assessment of financial risks
IFRS requires companies to provide detailed disclosures of financial risks in their financial statements. This helps in identifying potential risks to a company’s business more accurately, contributing to transparency and confidence in the financial markets.
International business Standardisation
By applying uniform accounting standards internationally, IFRS enables companies to provide consistent and understandable financial reporting. This iseasily accepted and understood by investors from different countries,increasing confidence and interest from potential foreign investors.
Additionally, IFRS facilitates easier comparison of financial performance for companies operating in different markets, which is essential for investors seeking global investment opportunities.
Additionally, IFRS facilitates easier comparison of financial performance for companies operating in different markets, which is essential for investors seeking global investment opportunities.
Enhancing company competitiveness
IFRS demonstrates a company's commitment to high standards of financial reporting and transparency, building trust and reputation with investors, customers, business partners and other stakeholders. Companies that present reliable and transparent IFRS-compliant financial reports are perceived as more credible and professional, attracting new customers and investors.