ICASL publishes 2011 Bound Volume of Sri Lanka Accounting Standards

The Institute of Chartered Accountants of Sri Lanka (ICASL) recently published the 2011 Bound Volume of the Sri Lanka Accounting Standards which will be effective from 1 January 2012 and is based on the corresponding International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS) (2009 bound volume).

Quality and reliability of financial reporting is one of the key elements in the successful development of the capital market in any country. Successful financial reporting depends upon, inter alia, the availability of an effective set of financial reporting standards in line with those prevailing internationally, promulgated by a recognised international standard setting body.

The Sri Lanka Accounting and Auditing Standards Act No. 15 of 1995 empowers the Institute of Chartered Accountants of Sri Lanka, from time to time, to adopt and promulgate accounting standards as may be necessary for the purpose of maintaining uniformity and high quality in financial reporting of business enterprises.

The Sri Lanka Accounting Standards are largely based on the corresponding International Accounting Standards promulgated by the International Accounting Standards Board (IASB).

However, before adoption, every international accounting standard undergoes a due review process by the Statutory Accounting Standards Committee set in motion by the Institute, to ensure that the standard is relevant in the Sri Lankan context.

Once a standard is adopted by its council, it needs to be published in the government gazette for legal purposes. The committee over the years has undertaken the task of reviewing the international accounting standards and international financial reporting standards, as and when they are issued by the IASB and recommending them for adoption by the council of ICASL.

In late 2009, the committee together with the Council of ICASL made a vital decision to converge fully with International Financial Reporting Standards and thereafter to adopt all pronouncements issued by the IASB.

Accordingly, the Sri Lanka Accounting Standards in this edition which are effective from 1st January 2012 are based on the corresponding International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS) (2009 bound volume) formulated by the International Accounting Standards Board (IASB) and its predecessor International Accounting Standards Committee (IASC) respectively.

This latest edition includes all IFRS and IAS, of which the following are new to the Sri Lankan financial reporting framework:

• IFRS 1 – First-time Adoption of International Financial Reporting Standards
•     IFRS 4 – Insurance Contracts
• IFRS 6 – Exploration for and Evaluation of Mineral Resources

nIAS 29 – Financial Reporting in Hyperinflationary Economies, and

•     IAS 41 – Agriculture

As an integral part of SLFRS and LKAS, an application guidance has been published separately, which includes pronouncements of International Financial Reporting Interpretation Committee (IFRIC) and Standing Interpretations Committee (SICs).

Printed copies of the book can be obtained from the ICASL Main Library.