The IFRS for SMEs Accounting Standard Update provides insights into the latest updates and discussions around the standard, including the ongoing redeliberations by the International Accounting Standards Board (IASB).
Key updates include:
Redeliberations of Proposals: IASB completed redeliberations of proposals in the 2022 Exposure Draft, including changes to the Statement of Comprehensive Income and Business Combinations. Notably, changes to the disclosure requirements and transition rules for the third edition were discussed.
Comprehensive Review: The second comprehensive review of the IFRS for SMEs Accounting Standard is nearing completion. Key consultation documents included the Request for Information, Exposure Draft, and Addendum, which aimed to gather feedback from stakeholders to refine the Standard.
Revised Revenue Recognition: Section 23 on Revenue from Contracts with Customers is being revised to align with IFRS 15. The changes will simplify revenue recognition requirements for SMEs, ensuring they reflect the performance obligations in simpler contracts.
The revised section will feature:
A five-step model for revenue recognition
Simplified language and reduced complexity
Enhanced disclosure on revenue, contract balances, and key judgements
The third edition of the IFRS for SMEs Accounting Standard, which includes these revisions, is expected to be issued in February 2025. These changes aim to improve the clarity and usability of the Standard for SMEs globally.