Subject of IFRS, International Financial Reporting Standards are accounting standards for
enterprises listed with the stock exchange. The European Union EU obliges such companies, generally
starting January 1, 2005, to draw up their consolidated annual accounts in compliance with theses
standards.
With the implementation of these standards the European Union is adapting to the worldwide trend of
companies to use the principles of IFRS for their annual accounts.
Other than the traditional accounting based on German Commercial Code (HGB) with its emphasis on creditor
protection IFRS is rather focused on shareholder interests. Along with this change in philosophy goes the
move from historical cost accounting to (partial) fair value accounting.
One of the major objectives of the new rules is to enhance efficiency of European capital markets.
The Competence Centre of Nexia Deutschland provides services to clients and Nexia offices for the conversion
to ISRF and is involved in the discussions about pros and cons to implement IFRS with small and intermediate
size enterprises.
