The UK Quoted Companies Alliance has urged the
Accounting Standards Board (ASB) to reconsider proposed changes to
financial reporting that would see some small and medium ‘publicly
accountable’ companies use full IFRS.

The draft standard, FRED 45: Financial
Reporting Standard for Public Benefit Entities
, issued by the
ASB in March, was developed “because IFRS-based standards are
written for the ‘for-profit’ sector and do not address some
transactions that are specific to the public benefit entity
sector”, the ASB said.

The Quoted Companies Alliance, a listed SMEs
lobby group, said it is worried about the three-tier reporting
framework proposed by the ASB, in particular the categories of
companies that would have to use full IFRS.

“The proposed definition of ‘publicly
accountable’ would require companies on AIM and PLUS-quoted to use
full IFRS, which exceeds the already stringent EU accounting
regulations,” the Quoted Companies Alliance said.

The SME think tank said the ASB should
consider allowing AIM and PLUS-quoted companies the option to use
the FRSME [reporting standard for medium-size entities] as it would
be “less complex and more appropriate” than full IFRS.

Quoted Companies Alliance chief executive Tim
Ward said under the current ASB proposals many more companies will
be dragged into using full IFRS, “which is continually cited as
being overly complex from both a preparer’s and user’s
perspective”. “We would like to see the ASB leading the way on
developing proportionate accounting standards for companies rather
than gold-plating EU regulations,” Ward said.

The ASB consultation on FRED 45 ended on 30
April and the ASB is said to be reviewing all the responses