International Accounting Standards (IAS), developed by the International Accounting Standards Committee (IASC), preceded the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). While many IAS have been superseded by IFRS, several remain active, reflecting the evolving nature of global accounting standards.
Active International Accounting Standards:
- IAS 1 – Presentation of Financial Statements: Establishes guidelines for the overall presentation of financial statements, ensuring comparability both with the entity's financial statements of previous periods and with the financial statements of other entities.
- IAS 2 – Inventories: Provides guidance on the determination of cost and its subsequent recognition as an expense, including any write-down to net realizable value.
- IAS 7 – Statement of Cash Flows: Requires the presentation of information about historical changes in cash and cash equivalents through a statement of cash flows.
- IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors: Prescribes the criteria for selecting and changing accounting policies, along with the accounting treatment and disclosure of changes in accounting policies, changes in accounting estimates, and corrections of errors.
- IAS 10 – Events After the Reporting Period: Defines events after the reporting period and sets out principles for recognizing, measuring, and disclosing these events.
- IAS 12 – Income Taxes: Provides guidance on the accounting treatment for income taxes, including the recognition of deferred tax assets and liabilities.
- IAS 16 – Property, Plant and Equipment: Outlines the accounting treatment for most types of property, plant, and equipment.
- IAS 19 – Employee Benefits: Prescribes the accounting and disclosure for employee benefits, including short-term benefits, post-employment benefits, and other long-term benefits.
- IAS 20 – Accounting for Government Grants and Disclosure of Government Assistance: Deals with the accounting for, and disclosure of, government grants and other forms of government assistance.IAS Plus
- IAS 21 – The Effects of Changes in Foreign Exchange Rates: Guides the accounting for foreign currency transactions and foreign operations.IAS Plus+1saipa.co.za+1
- IAS 23 – Borrowing Costs: Specifies the accounting treatment for borrowing costs, requiring capitalization of borrowing costs that are directly attributable to the acquisition, construction, or production of a qualifying asset.IAS Plus+1saipa.co.za+1
- IAS 24 – Related Party Disclosures: Requires disclosures about related party relationships, transactions, and outstanding balances.
- IAS 26 – Accounting and Reporting by Retirement Benefit Plans: Specifies the requirements for the financial reports of retirement benefit plans.IAS Plus
- IAS 27 – Separate Financial Statements: Prescribes the accounting and disclosure requirements for investments in subsidiaries, joint ventures, and associates when an entity prepares separate financial statements.
- IAS 28 – Investments in Associates and Joint Ventures: Sets out the equity method of accounting for investments in associates and joint ventures.IAS Plus
- IAS 29 – Financial Reporting in Hyperinflationary Economies: Provides guidance on financial reporting in economies experiencing hyperinflation.IAS Plus
- IAS 32 – Financial Instruments: Presentation: Establishes principles for presenting financial instruments as liabilities or equity and for offsetting financial assets and financial liabilities.
- IAS 33 – Earnings Per Share: Prescribes principles for determining and presenting earnings per share.IAS Plus+1saipa.co.za+1
- IAS 34 – Interim Financial Reporting: Provides guidance on the preparation of interim financial reports.IAS Plus
- IAS 36 – Impairment of Assets: Prescribes the procedures that an entity applies to ensure that its assets are carried at no more than their recoverable amount.
- IAS 37 – Provisions, Contingent Liabilities and Contingent Assets: Ensures that appropriate recognition criteria and measurement bases are applied to provisions, contingent liabilities, and contingent assets.
- IAS 38 – Intangible Assets: Outlines the accounting treatment for intangible assets that are not dealt with specifically in another Standard.
- IAS 40 – Investment Property: Prescribes the accounting treatment for investment property and related disclosure requirements.IAS Plus
- IAS 41 – Agriculture: Deals with the accounting treatment of agricultural activity.
Reasons for the Continuation of Certain IAS:
The persistence of these IAS alongside newer IFRS can be attributed to several factors:
- Comprehensive Coverage: Some IAS provide detailed guidance that remains relevant and comprehensive, reducing the immediate need for replacement.
- Ongoing Projects: The IASB has prioritized certain projects over others based on stakeholder feedback and the potential impact on financial reporting. For instance, projects on intangible assets and the statement of cash flows are part of the research pipeline, with plans to commence within the next five years. IFRS
- Resource Allocation: Developing new standards requires significant resources. The IASB must balance its agenda to address emerging issues while maintaining existing standards.
The IASB continually assesses its work program to address contemporary issues in financial reporting. While some IAS may eventually be replaced or updated, others might remain if they continue to meet the needs of users effectively. The timeline for these changes depends on various factors, including stakeholder feedback, the complexity of the topics, and the IASB's strategic priorities. As of June 2024, the IASB has made significant progress, issuing new standards like IFRS 18 and IFRS 19, and adding projects on intangible assets and the statement of cash flows to its research pipeline. IFRS
Major accounting firms, such as those in the Big Four, acknowledge the challenges in standard-setting and emphasize the importance of aligning standards with global best practices. For instance, discussions around the convergence of IFRS and US GAAP highlight.
Source material was obtained after due study on the following source centre with little my own opinion.
