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IFRS For Dummies by Steven Collings

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Chapter 3

Taking the Plunge: Adopting IFRS for the First Time

In This Chapter

arrow Knowing the IFRS policies and how they can differ from domestic ones

arrow Seeing what to put in the opening statement of financial position

arrow Examining some exemptions

arrow Making the statement of compliance with confidence

Many countries still use their own domestic accounting standards (Generally Accepted Accounting Practices, or GAAP) but are looking at the potential to change over to IFRS. Why? Because more and more countries are using IFRS, and that means if your country’s on board, you can access more capital markets. IFRS have been created to produce high-quality financial information that facilitates investment and other economic decisions across borders, resulting in market efficiency and a reduction in the cost of capital.

The standard that deals with first-time adoption of IFRS is IFRS 1, aptly named First-time Adoption of International Financial Reporting Standards. The principal aim of IFRS 1 is to ensure that a company adopting IFRS for the first time produces financial statements, and interim financial ...

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