Global Standards for the world economy

Thursday 02 April 2020

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Project history

Project history


On 9 July 2009 the IASB published an International Financial Reporting Standard (IFRS) designed for use by small and medium-sized entities (SMEs). SMEs include all entities that are not publicly traded and that are not banks or similar financial institutions. SMEs are estimated to represent well over 95 per cent of all companies in both developed and developing countries. The standard is the result of a five-year development process with extensive consultation of SMEs worldwide.

The complete IFRS for SMEs (together with the basis for conclusions, illustrative financial statements, and a presentation and disclosure checklist) can be downloaded free of charge. To do so, click here.

Due process steps leading to the IFRS for SMEs

  • Project was carried forward from the former IASC agenda. IASB deliberations began in July 2003.
  • June 2004: Publication of the discussion paper (DP) Preliminary Views on Accounting Standards for Small and Medium-sized Entities; comment deadline 24 September 2004
  • April 2005: Staff Questionnaire on Possible Recognition and Measurement Modifications for Small and Medium-sized Entities (SMEs).
  • October 2005: Public round-table discussions with the Board on recognition and measurement simplifications.
  • July 2003 - February 2007: Deliberation of the issues by the Board at 31 public Board meetings.
  • August 2006: A complete staff draft of the exposure draft (ED) is posted on the IASB website
  • November 2006: A revised staff draft is posted on the IASB website.
  • February 2007: Publication of the ED (English language); comment deadline 30 November 2007 
  • November 2007. Translations into four languages posted subsequently.
  • April 2007: Publication of a staff overview of the ED on the IASB's website.
  • June 2007: Field-testing of the ED with the participation of 116 small companies in 20 countries
  • November 2007: End of the comment period; 162 comment letters received.
  • March - April 2008: Staff present to the Board an overview of the main issues raised in the comment letters and field tests.
  • April 2008: Working Group submits comprehensive recommendations for possible changes to the ED.
  • May 2008 April 2009: Board redeliberations of the proposals in the ED at 13 public Board meetings.
  • April 2009: Board decides that the name of the final standard will be International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs), as proposed in the ED.
  • June 2009: 13 Board members vote in favour, 1 dissenting opinion.
  • July 2009: Publication of the IFRS for SMEs  

Why did the IASB undertake this project?

Because full IFRSs were designed to meet the needs of equity investors in companies in public capital markets, they cover a wide range of issues, contain a sizeable amount of implementation guidance and include disclosures appropriate for public companies. Users of the financial statements of SMEs do not have those needs, but, rather are more focused on assessing shorter-term cash flows, liquidity and solvency. Also, many SMEs say that full IFRSs impose a burden on them—a burden that has been growing as IFRSs have become more detailed and more countries have begun to use them. Thus, in developing the proposed IFRS for SMEs, IASB's twin goals were to meet user needs while balancing costs and benefits from a preparer perspective.

Project objective

The objective of this project was to develop an IFRS expressly designed to meet the financial reporting needs of entities that (a) do not have public accountability and (b) publish general purpose financial statements for external users. Examples of such external users include owners who are not involved in managing the business, existing and potential creditors, and credit rating agencies. The IFRS for SMEs was derived from full IFRSs with appropriate modifications based on the needs of users of SME financial statements and cost-benefit considerations.

Was this project part of the Memorandum of Understanding?

No. The MoU sets out a Roadmap of Convergence between IFRSs and US GAAP 2006-2008. US GAAP does not have a separate financial reporting standard for SMEs.

Click here for more information on the MoU.

Working Group

The Board formed a Working Group whose members provided views and comments on specific issues that were presented to them.

The Working Group met on:

  • 23 April 2003
  • 29 - 30 June 2005
  • 30 - 31 January 2006 
  • 10 - 11 April 2008

Related information

  • Click here for the 2007 Exposure Draft and Comment letters.
  • Click here for the 11 April 2005 staff questionnaire.
  • Click here for the 2004 Discussion Paper and Comments letters 
  • Click here for the meeting summaries and observer notes
  • Click here for the meeting audio playback.

Project contact

Darrel Scott 
Board Member, Chairman of the SME Implementation Group 


Michelle Fisher
Senior Technical Manager, IFRS for SMEs