engleski

Role of International Financial Reporting Standards for small and medium sized entitites in the quality of business information.

The appearance of the globalization process has affected all segments of each society, and also a financial reporting system that gives users essential information about business entity’s performance and liquidity. Absolute harmonization of financial reporting is still impossible to achieve due to the many differences between countries, among which the most significant are different economic environments and different legal systems. Accounting standards have one of the most important roles in the financial reporting harmonization process, among which the most significant are International Financial Reporting Standards. Those standards represent the most important instrument for the harmonization of listed and large companies. At the global level, harmonization is mostly achieved for this category of enterprises, while small and medium sized enterprises in most countries continue to use national accounting standards. Due to the fact that small and medium-sized enterprises operate outside national borders increasingly, it is necessary to pay more attention to the harmonization of financial reporting of this category of enterprises. Accordingly, appropriate scientific methods will be used in this paper to explore the role of IFRS for SMEs in preparing comparable and consistent financial statements at the international level, which is a basic assumption of quality financial reporting, and is important in obtaining relevant and reliable business information that users use in decision-making process.

IFRS for SMEs; financial reporting; decision making process; harmonization

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