IFRS for SMEs summary and timeline

A summary of IFRS for SMEs, including information on current proposals and a timeline of past amendments, announcements, exposure drafts and consultations.

Summary

The IFRS for SMEs is a standalone document, other than one fallback option to use IAS 39 for financial instruments rather than the relevant sections of the IFRS for SMEs. It simplifies the accounting guidance included in full IFRS by:

• excluding topics which are less relevant to SMEs, such as segment and interim reporting;
• omitting the complex option where there is choice, such as the revaluation model for property, plant and equipment;
• simplifying recognition and measurement criteria, for example borrowing and development costs are all expensed in the period in which they are incurred; and
• reducing disclosure requirements, such that the IFRS for SMEs requires approximately one tenth of the disclosures required by full IFRS.

Who can use the standard?

The IFRS is intended for use by small and medium sized entities (SMEs). These are defined within the standard as entities that:

• do not have public accountability, and
• publish general purpose financial statements for external users.

The IASB has deferred the decision on which entities are required or permitted to use the IFRS for SMEs to the legislative and regulatory authorities and standard-setters in individual jurisdictions.

Accordingly there is no effective date for the standard, as this is dependent upon local adoption.

Current proposals

1. In 2020 the IASB began its second comprehensive review of the IFRS for SMEs. An exposure draft of the third edition of the standards was issued in September 2022. A number of amendments are proposed, including aligning the standard with certain aspects of the Conceptual Framework, IFRS 10 Consolidated Financial Statements, IFRS 13 Fair Value Measurement and IFRS 15 Revenue from Contracts with Customers.
   • Read Exposure Draft: Third edition of the IFRS for SMEs Accounting Standard
2. The IASB is developing a reduced disclosure IFRS Standard that will apply on a voluntary basis to subsidiaries that qualify to use the IFRS for SMEs. This will allow them to apply the recognition and measurement requirements of full IFRS Standards but prepare disclosures in line with those required by the IFRS for SMEs. ED/2021/7 Subsidiaries without Public Accountability: Disclosures was issued in 2021.
   • Read ED/2021/7 Subsidiaries without Public Accountability: Disclosures

Timeline

Date	Update
8 September 2022	The IASB issued exposure draft Third edition of the IFRS for SMEs Accounting Standard. Comments are to be received by 7 March 2023.
17 April 2020	Supplementary IASB Update April 2020 – impact of covid-19 The IASB extended the deadline for comments on the Request for Information on Comprehensive Review of the IFRS for SMEs Standard from 27 July 2020 to 27 October 2020 due to the COVID-19 pandemic.
28 January 2020	IASB consults on approach to updating its IFRS for SMEs Standard The IASB has published a Request for Information as the first step in its second comprehensive review of the IFRS for SMEs. Comments are to be received by 27 July 2020.
21 May 2015	IASB completes comprehensive review of the IFRS for SMEs The IASB announces limited amendments to the standard and issues 2015 Amendments to the IFRS for SMEs Standard.
3 October 2013	The IASB issues exposure draft ED/2013/9 Proposed amendments to the International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs). Comments are to be received by 3 March 2014.
26 June 2012	The IASB issues Request for Information: Comprehensive Review of IFRS for SMEs. The consultation deadline is 30 November 2012.
11 August 2009	ASB seeks views on proposals for the future reporting requirements for UK and Irish entities Press release issued by the Accounting Standards Board on 11 August 2009 with details of a proposal to implement IFRS for SMEs in the place of existing UK Financial Reporting Standards.
9 July 2009	IASB publishes IFRS for SMEs The IFRS for SMEs is effective on date of issue, subject to adoption by each jurisdiction.