Question

The 'International Financial Reporting Standard for Small and Medium-sized Entities' was released in May 2015 (IFRS for SMEs).

The AICPA has issued its Financial Reporting Framework for Small- and Medium-Sized Entities. The FRF for SMEs™ accounting framework is designed for America's small business community.

Discuss why you think these efforts are important- provide five reasons.

Answer 1

The AICPA has issued its Financial Reporting Framework for small- and medium sized entities. The FRF for SMEs accounting framework id designed for America's small business community. These efforts are important because:

• It helps the small business, CPAs and CPA firms, users of financial statement to understand and learn the reporting option about the FRF for SMEs.
• To ensure reliability about the information provided in the financial statement.
• To reduce the cost of preparing, auditing and compiling of financial statements and provide other useful information as required by them.
• To make accounting and it's disclosure simple.
• So that the accounting standards are responsive to the issues and concerns that stakeholders have to deal with while preparing statement for small private business.