IASB , IASCF , IASC
IASB, IASCF, and IASC Defined
IASB: International Accounting Standards Board
The International Accounting Standards Board is an independent, private-sector body that develops and approves International Financial Reporting Standards. The IASB operates under the oversight of the International Financial Reporting Standards Foundation. The IASB was formed in 2001 to replace the International Accounting Standards Committee.
International Financial Reporting Standards Foundation
The International Financial Reporting Standards Foundation (until March 2010 known as the International Accounting Standards Committee Foundation) is the independent, non-profit foundation, created in 2000 to oversee the IASB. Click for more information about the IFRS Foundation Structure.
IASC: International Accounting Standards Committee
From 1973 until a comprehensive reorganisation in 2000, the structure for setting International Accounting Standards was known as the International Accounting Standards Committee. There was no actual “committee” of that name. The standard-setting board was known as the IASC Board.
Under the IFRS Foundation Constitution, the objectives of the IASB are:
- (a) to develop, in the public interest, a single set of high quality, understandable and enforceable global accounting standards that require high quality, transparent and comparable information in financial statements and other financial reporting to help participants in the world’s capital markets and other users make economic decisions;
- (b) to promote the use and rigorous application of those standards;
- (c) in fulfilling the objectives associated with (a) and (b), to take account of, as appropriate, the special needs of small and medium-sized entities and emerging economies; and
- (d) to bring about convergence of national accounting standards and International Accounting Standards and International Financial Reporting Standards to high quality solutions.
The International Accounting Standards Committee (IASC) – 1973-2000
The former IASC worked from 1973-2000 to accomplish those objectives.
It promulgated a substantial body of Standards, Interpretations, a Conceptual Framework, and other guidance that is adopted directly by many companies and that is looked to by many national accounting standard-setters in developing national accounting standards.
The International Accounting Standards Board (IASB) – Starting 2001
The IASC was restructured into the IASB at the start of 2001.
Since 2001, the standards-setting work of the IFRS Foundation is conducted by the International Accounting Standards Board (IASB). An IFRS Interpretations Committee(IFRIC) develops and solicits comment on interpretive guidance for applying Standards promulgated by the IASB, but the IASB must approve the Interpretations developed by IFRIC.
Under the IFRS Foundation Constitution, the IASB shall:
- (a) have complete responsibility for all IASB technical matters including the preparation and issuing of International Accounting Standards, International Financial Reporting Standards and Exposure Drafts, each of which shall include any dissenting opinions, and final approval of Interpretations by the International Financial Reporting Interpretations Committee;
- (b) publish an Exposure Draft on all projects and normally publish a discussion document for public comment on major projects;
- (c) have full discretion in developing and pursuing the technical agenda of the IASB and over project assignments on technical matters: in organising the conduct of its work, the IASB may outsource detailed research or other work to national standard-setters or other organisations;
- (i) establish procedures for reviewing comments made within a reasonable period on documents published for comment,
- (ii) normally form working groups or other types of specialist advisory groups to give advice on major projects,
- (iii) consult the Standards Advisory Council on major projects, agenda decisions and work priorities, and
- (iv) normally issue bases for conclusions with International Accounting Standards, International Financial Reporting Standards, and Exposure Drafts;
- (e) consider holding public hearings to discuss proposed standards, although there is no requirement to hold public hearings for every project;
- (f) consider undertaking field tests (both in developed countries and in emerging markets) to ensure that proposed standards are practical and workable in all environments, although there is no requirement to undertake field tests for every project; and
- (g) give reasons if it does not follow any of the non-mandatory procedures set out in (b), (d)(ii), d(iv), (e) and (f).
Distinction Between IASs and IFRSs
The term International Financial Reporting Standards (IFRSs) has both a narrow and a broad meaning. Narrowly, IFRSs refers to the new numbered series of pronouncements that the IASB is issuing, as distinct from the International Accounting Standards (IASs) series issued by its predecessor. More broadly, IFRSs refers to the entire body of IASB pronouncements, including standards and interpretations approved by the IASB and IASs and SIC interpretations approved by the predecessor International Accounting Standards Committee.
On this website, consistent with IASB policy, we abbreviate International Financial Reporting Standards (plural) as IFRSs and International Accounting Standards (plural) as IASs.
Compliance with IASB Standards
Definition of IFRSs
IAS 1.7 defines IFRSs as comprising:
- International Financial Reporting Standards;
- International Accounting Standards; and
- Interpretations originated by the IFRS Interpretations Committee (IFRIC) or the former Standing Interpretations Committee (SIC).
Compliance with IFRSs
IAS 1.16 states:
“An entity whose financial statements comply with IFRSs shall make an explicit and unreserved statement of such compliance in the notes. Financial statements shall not be described as complying with IFRSs unless they comply with all the requirements of IFRSs.”
When a Standard or an Interpretation specifically applies to a transaction, other event, or condition, the accounting policy or policies applied to that item shall be determined by applying the Standard or Interpretation and considering any relevant Implementation Guidance issued by the IASB for the Standard or Interpretation. [IAS 8.7]
If a Standard or Interpretation does not address a specific transaction, event, or condition explicitly, IAS 8.10-12 requires:
10. In the absence of a Standard or an Interpretation that specifically applies to a transaction, other event, or condition, management shall use its judgement in developing and applying an accounting policy that results in information that is:
(a) relevant to the economic decision-making needs of users; and
(b) reliable, in that the financial statements:
(i) represent faithfully the financial position, financial performance and cash flows of the entity;
(ii) reflect the economic substance of transactions, other events and conditions, and not merely the legal form;
(iii) are neutral, ie free from bias;
(iv) are prudent; and
(v) are complete in all material respects.
11. In making the judgement described in paragraph 10, management shall refer to, and consider the applicability of, the following sources in descending order:
(a) the requirements and guidance in Standards and Interpretations dealing with similar and related issues; and
(b) the definitions, recognition criteria and measurement concepts for assets, liabilities, income and expenses in the Framework.
12. In making the judgement described in paragraph 10, management may also consider the most recent pronouncements of other standard setting bodies that use a similar conceptual framework to develop accounting standards, other accounting literature and accepted industry practices, to the extent that these do not conflict with the sources in paragraph 11.