Why would a private company in the United States choose to prepare its financial statements in accordance with IFRS for SMEs?
The reasons why a private U.S. company would prepare IFRS for SMEs-based financial statements are varied, depending upon the objectives of the company and the needs of its financial statement users. Some U.S. private companies may find the simplified IFRS for SMEs an attractive alternative to the more complicated and voluminous U.S. GAAP. Those private companies may find IFRS for SMEs to be a more relevant and less costly financial accounting and reporting standard than U.S. GAAP. Other examples of why a private company in the U.S. may decide to use IFRS for SMEs include the following: • the private company is owned by a foreign parent • the private company has a foreign investor • the private company is a supplier to foreign companies • the private company has a foreign venture partner An ever increasing amount of private companies are looking to conduct business outside the Unites States and obtain foreign financing. Using a common global financial accounting and reporting standard,
