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Is There a Solid Empirical Foundation for the IASB's Draft IFRS for SMEs?

Alexander Schiebel

Vienna University of Economics and Business Administration

February 18, 2008

In February 2007 the International Accounting Standards Board (IASB) published its draft International Financial Reporting Standard for Small and Medium-sized Entities ('IFRS for SMEs'). It aims to provide a simplified, self-contained set of rules based on the present set of IFRS but adapted for entities without public accountability (called small and medium-sized entities (SMEs) by the IASB). The adaptation purports to be based exclusively on the common information needs of external users of SMEs' financial statements. As yet, there is little academic literature identifying what these information needs are. Had the IASB's "common information needs" been derived from serious empirical research worldwide, the empirical analyses would have formed part of the IASB due process that led to the publication of the draft standard. This paper, therefore, consists of an analysis of this due process. The conclusion is drawn that the IASB did not prepare serious worldwide empirical analyses. Moreover, it can be shown that the conclusions of the IASB incorporated in the draft standard are biased towards the opinions of auditors and accountants. International research is now essential. Otherwise it will be a matter of luck whether an IFRS for SMEs meets the common information needs of its targeted external users.

Number of Pages in PDF File: 29

Keywords: SME, IFRS, user needs, IASB, differentiation

JEL Classification: M41, M44, M47

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Date posted: July 24, 2007 ; Last revised: February 20, 2008

Suggested Citation

Schiebel, Alexander, Is There a Solid Empirical Foundation for the IASB's Draft IFRS for SMEs? (February 18, 2008). Available at SSRN: https://ssrn.com/abstract=994684 or http://dx.doi.org/10.2139/ssrn.994684

Contact Information

Alexander Schiebel (Contact Author)
Vienna University of Economics and Business Administration ( email )
Althanstraße 39-45
0043 1 31336 4606 (Phone)
0043 1 31336 718 (Fax)
HOME PAGE: http://www.wu-wien.ac.at/revision/
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