Analysis of the Stakeholders' Needs and Their Inference Upon Financial Reports of SMEs

Abstract

In the context of the international trend to simplify the SMEs’ financial reporting, one may identify a stringent call for the identification and serious analysis of the SMEs’ specific stakeholders and their needs. It appears that these needs are not sufficiently developed at present so that they can play a useful part in the accounting regulators current actions. Hence, the main objective of this paper is to identify the specific needs of SMEs’ stakeholders. In order to achieve this we conducted a content analysis and a processing based on economic analysis methods of the comment letters to ED-IFRS for SMEs. The results of the analysis, in correlation with the stakeholder’s theory - the normative approach - and resource dependence theory were then used for identifying and ranking SMEs’ specific users. Finally, knowing the SMEs’ specific stakeholders and their needs has led to the analysis of their inference upon financial reports. This inference was then differentiated into elements of the conceptual framework, recognition and measurement criteria and respectively the information to be disclosed.

Keywords: ED-IFRS for SMEs, comment letters, SMEs’ stakeholders’ salience, SMEs’ stakeholders’ needs

JEL Classification: M41, M47, M16, O52, F00