Press release: Deloitte Luxembourg publishes new brochure - IFRS for SMEs versus LUX GAAPDOWNLOAD
With the aim of providing a clear and practical overview of the differences between the requirements of IFRS (International Financial Reporting Standards) for SMEs (Small and Medium-sized Entities) and LUX GAAP (Luxembourg Generally Accepted Accounting Principles), Deloitte S.A. has published a comparison between the two accounting frameworks highlighting the variations commonly possible.
IFRS for SMEs were issued by IASB (International Accounting Standards board), as an alternative framework that can be applied by eligible entities in place of the full IFRSs, as the latter is designed to meet the needs of public capital markets, thus too complex for smaller businesses.
Today, IFRS for SMEs are neither part of the European Accounting Regulation, nor of the current Luxembourg commercial law. Accordingly it cannot be used for statutory purposes. Nevertheless there could be entities in Luxembourg applying it for group reporting purposes, because IFRS for SMEs has already been adopted in several jurisdictions.
Eddy Termaten, audit partner and IFRS leader of Deloitte S.A, explains “Once allowed to be applicable in Luxembourg, financial statements prepared under IFRS for SMEs will be based on internationally accepted financial reporting standards. As such, it could help certain entities (for example those being a subsidiary of a listed entity) to reduce their administrative costs, as one set of financial statements can now be used for different purposes. Even though the application of IFRS for SMEs is not yet allowed in Luxembourg for statutory purposes, we decided to perform the comparison and publish the brochure now, so that those who are interested can start an analysis of the differences with LUX GAAP and are one step ahead at the moment the IFRS for SMEs will be allowed in Luxembourg. We are convinced that there are already some entities considering the implementation and we would like to help them by providing an overview of the requirements of each principle and of their differences.”