Extension of EU accounts rule urged

A NEW EU regulation requiring listed companies to prepare their accounts in accordance with international standards should be extended to all companies, an accountants’ body said yesterday.

In a submission to the Tánaiste and Minister for Enterprise Mary Harney, the Institute of Chartered Accountants in Ireland (ICAI) said the rule that listed firms should comply with International Financial Reporting Standards (IFRS) from 2005 should be extended to all companies, subject to an optional transition period for SMEs to help them deal with both training issues and the workload involved in converting their systems.

Early last year, the EU Industry Council adopted a regulation which requires all listed companies in the EU to prepare their consolidated financial statements in accordance with IFRS.

Member states have an option to extend the requirement or to permit other firms to adopt the same system.

ICAI chief executive Brian Walsh said: “The requirement to prepare accounts in compliance with IFRS from January 1, 2005, may not be practicable for some SMEs where there might be concerns about the volume of work involved in rewriting current financial statements for compliance with IFRS as well as education and training issues.

“We do not foresee that the actual conversion to IFRS is likely to have a significant impact on the amounts of disclosures in most financial statements.”