The International Accounting Standards Board (IASB) set out for consultation Monday a new standard that would allow eligible subsidiaries to apply IFRS with a reduced set of disclosure requirements.
The IASB published an overview of its proposal.
The standard would allow subsidiaries to save time and money, the IASB said, by:
- Eliminating the need to maintain an additional set of accounting records for reporting purposes — if the subsidiary currently does not apply IFRS in its own financial statements; and
- Reducing the disclosures required to comply with IFRS.
Sue Lloyd, IASB vice-chair, said: "Our proposed standard aims to provide a solution that will simplify reporting and be cost-effective for subsidiaries while meeting the information needs of the users of their financial statements."
The board said the proposed standard would be available to "subsidiaries without public accountability" — companies that are not financial institutions or listed on a stock exchange — whose parent company prepares consolidated financial statements applying IFRS.
— Oliver Rowe (Oliver.Rowe@aicpa-cima.com) is an FM magazine senior editor.