In an economy of globalization, accounting reports have to be short and harmonizable. With the International Financial Reporting Standards (IFRS), financials in corporate accounts become uniform and harmonizable even across continents. This article consolidates IFRS, its adoption, and the manner in which IFRS audits ensure that financial health is intact.
Understanding IFRS
International Financial Reporting Standards (IFRS) is a standard of regulation developed by the International Accounting Standards Board (IASB). IFRS requires financial transactions and events to be disclosed in financial reports with a view to induce convergence, transparency, and comparability in international financial reports. IFRS, up to now, has been used in over 140 countries worldwide and has emerged as the backbone of global finance disclosure.
Primary Aims of IFRS
- Transparency: Financial reporting gets standardized under IFRS, making financial reports transparent as well as similar so that decision makers can use the information easily.
- Accountability: Financial reports under IFRS provide a truthful and faithful image of financials of any organization and thereby help in establishing accountability.
- Efficiency: It eliminates the exertion of working towards multiple reports for multiple locations and hence allows efficient financial reporting processes.
Key Components of IFRS
IFRS addresses an array of issues. The most relevant standards are:
- IFRS 1: First-time Adoption of International Financial Reporting Standards – Provides relief to entities on initial adoption of IFRS.
- IFRS 9: Financial Instruments – Describes how to classify, measure, and recognize financial instruments.
- IFRS 15: Revenue from Contracts with Customers – Provides guidance in reporting information about the nature, amount, timing, and uncertainty of revenue and cash flows from contracts with customers.
- IFRS 16: Leases – Offers accounting that is applied, measured, presented, and disclosed for leases.
They and others provide a common framework of financial reporting that is consistent and reliable.
The Role of IFRS Audits
A separate solo review of an organization’s financial reports for assurance of compliance with IFRS by an expert is helpful as follows:
- Credibility Establishment: Independent audit gives confidence to investors, regulators, and others regarding the reliability and credibility of financial reports.
- Compliance Assurance: Audits conducted from time to time give assurance to organizations to remain compliant with IFRS in order to avoid legal and monetary penalties for non-compliance.
- Areas of Improvement: Audits can even point out areas where financial procedures and controls would have to be improved, and that will lead to better financial management.
Financial Statement Audit Services
Financial statement audit services include detailed review of a business entity’s financial statements, balance sheet, income statements, cash flow statements, and equity statements. The primary objectives of such services are:
- Verification of Accuracy: To provide assurance that financial statements contain no material misstatements and present a true and fair view of an entity’s financial position.
- Evaluation of Internal Controls: To provide assurance that internal financial reporting controls are efficient to identify and prevent errors or frauds.
- Compliance Check: To provide assurance that financial statements adhere to applicable accounting principles, e.g., IFRS, and regulatory requirements.
Professional application of professional finance statement audit service is required in order to gain stakeholders’ trust and adhere to relevant law within time frame.
Quartis Consulting LLP: Your IFRS Compliance Partner
Technical skills and experience are required in order to overcome the complexity of IFRS and deliver quality financial reporting.
Qurtis Consulting LLP, being an Indian firm in Delhi, provides full-service audit outsourcing solutions, such as IFRS audits, and financial statement audit services. As a member of an association of Indian accounting and consulting firms, Quartis Consulting LLP provides:
- IFRS proficiency: With a team of IFRS experts, your financial statements will be internationally compliant.
- Personalized Solutions: These services will be customized according to your business’s specific needs and industry requirements.
- International Exposure: Exposure to international-class consultancy firms worldwide, thereby exposing them to an international environment and a feeling of exposure to various regulatory mechanisms.
Through their association with Quartis Consulting LLP, the companies are able to provide precise, sharp, and compliant financial reporting, thereby bringing in confidence and trust among the stakeholders.
Conclusion
International Financial Reporting Standards or IFRS are the promoters of financial reporting standardization worldwide. Business organizations who want to be transparent, accountable, and efficient in reporting their financials need to be responsive and follow such standards. Reliable IFRS audit and engagement professional audit services like Quartis Consulting LLP will authorize and give credibility to your financial reports.
