Sri Lanka

Update for August 2007
Update for April 2006
Update for September 2004
Update for October 2000
Financial Reporting Framework in Sri Lanka (2011 Update)

The following table lists Sri Lanka Accounting Standards 2011, published in late 2010 and effective from 1 January 2012. In late 2009, the Institute of Chartered Accountants of Sri Lanka made a decision to converge fully with all pronouncements issued by the IASB and thereafter to adopt all pronouncements issued by the IASB. Accordingly, the standards listed below incorporate all new and revised International Financial Reporting Standards as published by the IASB in the 2009 Bound Volume of IFRSs.

Sri Lanka Accounting Standards 2011
SLFRS/ LKASStandard NameEquivalent IAS/IFRS(1)
 Framework for the Preparation and Presentation of Financial Statements 
SLFRS 1First-time Adoption of Sri Lanka Accounting Standards (SLFRSs)(2)IFRS 1
SLFRS 2Share-based PaymentIFRS 2
SLFRS 3Business CombinationsIFRS 3
SLFRS 4Insurance ContractsIFRS 4
SLFRS 5Non-current Assets Held for Sale and Discontinued OperationsIFRS 5
SLFRS 6Exploration and Evaluation of Mineral ResourcesIFRS 6
SLFRS 7Financial Instruments: DisclosureIFRS 7
SLFRS 8Operating SegmentsIFRS 8
LKAS 1Presentation of Financial Statements(3)IAS 1
LKAS 2InventoriesIAS 2
LKAS 7Statement of Cash Flow StatementsIAS 7
LKAS 8Accounting Policies, Changes in Accounting Estimates and ErrorsIAS 8
LKAS 10Events After the Balance Sheet DateIAS 10
LKAS 11Construction ContractsIAS 11
LKAS 12Income TaxesIAS 12
LKAS 16Property, Plant and EquipmentIAS 16
LKAS 17Leases IAS 17
LKAS 18RevenueIAS 18
LKAS 19Employee BenefitsIAS 19
LKAS 20Accounting for Government Grants and Disclosure of Government AssistanceIAS 20
LKAS 21The Effects of Changes in Foreign Exchange RatesIAS 21
LKAS 23Borrowing CostsIAS 23
LKAS 24Related Party DisclosuresIAS 24
LKAS 26Accounting and Reporting by Retirement Benefit PlansIAS 26
LKAS 27Consolidated and Separate Financial StatementsIAS 27
LKAS 28Investments in AssociatesIAS 28
LKAS 29Financial Reporting in Hyperinflationary EconomiesIAS 29
LKAS 31Interests in Joint VenturesIAS 31
LKAS 32Financial Instruments: PresentationIAS 32
LKAS 33Earnings Per ShareIAS 33
LKAS 34Interim Financial Reporting IAS 34
LKAS 36Impairment of AssetsIAS 36
LKAS 37Provisions, Contingent Liabilities And Contingent AssetsIAS 37
LKAS 38Intangible AssetsIAS 38
LKAS 39Financial Instruments: Recognition and MeasurementIAS 39
LKAS 40Investment PropertyIAS 40
LKAS 41AgricultureIAS 41
SLFRS for SMEsSri Lanka Accounting Standard for Small and Medium-sized Entities(4)IFRS for SMEs

(1) 

As published in the 2009 edition of the IAS Bound Volume of International Financial Reporting Standards.

(2) 

Application of SLFRS and LKAS for the first time is deemed to be an adoption for the first time for the purposes of SLFRS 1 notwithstanding the entity's previous financial statements complied with Sri Lanka Accounting Standards, or otherwise contained a statement of compliance with Sri Lanka Accounting Standards, even though SLFRS also means Sri Lanka Accounting Standards.

(3) 

Paragraph 16 of LKAS requires the following: "An entity whose financial statements comply with SLFRSs shall make an explicit and unreserved statement of such compliance in the notes".

(4) 

The SLFRS for SMEs is intended for use by small and medium-sized entities, i.e. which do not have public accountability and which publish general purpose financial statements for external users. A number of entities are deemed to fall outside the standard by the Sri Lanka Accounting and Auditing Standards Act.

August 2007 Update

Sri Lanka will move to full IFRS compliance by 2011

The board of the Institute of Chartered Accountants of Sri Lanka (ICASL) has approved a policy that Sri Lankan Financial Reporting Standards will be fully compliant with International Financial Reporting Standards by 2011, meaning that a company that assets compliance with Sri Lankan standards could also assert compliance with IFRSs. The policy was announced by Yohan Perera, President of the ICASL, at an international conference on 'Fair Value – A Paragigm Shift' sponsored by the South Asian Federation of Accountants in Colombo, Sri Lanka, on 25 August 2007. Currently, Sri Lanka has adopted many, but not all, of the latest IFRSs.

Mr Perera also announced that Sri Lanka expects to adopt IAS 32 and IAS 39 in September 2007, to be effective in 2009.

April 2006 Update

The following table lists Sri Lanka Accounting Standards at April 2006. Except as indicated in the 'remarks' column, the SLAS are the same, in all material respects, as the related IAS/IFRS, including implementation guidance and basis for conclusions, though transition provisions and effective dates differ.

Sri Lanka Accounting Standards – April 2006
Sri Lanka Accounting StandardRemarks Relating to IASs/IFRSs
Framework for the Preparation and Presentation of Financial Statements 
SLAS 03 (revised 2005) Presentation of Financial StatementsReflects 2003 revisions to IAS 1 but not later revisions.
SLAS 05 (revised 2005) Inventories 
SLAS 09 Cash Flow Statements 
SLAS 10 (revised 2005) Accounting Policies, Changes in Accounting Estimates and Errors 
SLAS 12 (revised 2005) Events After the Balance Sheet Date 
SLAS 13 Construction Contracts 
SLAS 14 (revised 2005) Income Taxes 
SLAS 16 (issued 1995) Retirement Benefit CostsNot consistent with the current IAS 19. Consistent with the 1993 version of IAS 19.
SLAS 18 (revised 2005) Property, Plant and Equipment 
SLAS 19 (revised 2005) Leases  
SLAS 20 (issued 1995) Borrowing Costs 
SLAS 21 (revised 2005) The Effects of Changes in Foreign Exchange Rates 
SLAS 22 Accounting for InvestmentsThis is equivalent to the old IAS 25, which was replaced by IAS 39
SLAS 23 Revenue Recognition and Disclosures in the Financial Statements of BanksDisclosure provisions are consistent with IAS 30. Revenue recognition is additional.
SLAS 24 Accounting for Government Grants and Disclosure of Government Assistance 
SLAS 25 (revised 2004) Business Combinations 
SLAS 26 (revised 2005) Consolidated and Separate Financial Statements 
SLAS 27 (revised 2005) Investments in Associates 
SLAS 28 (issued 1998) Segment Reporting 
SLAS 29 (issued 1995) Revenue 
SLAS 30 (revised 2005) Related Party Disclosures 
SLAS 31 (revised 2005) Interests in Joint Ventures 
SLAS 32 PlantationsNo corresponding IAS
SLAS 33 Revenue Recognition and Disclosures in the Financial Statements of Finance CompaniesNo corresponding IAS
SLAS 34 (revised 2005) Earnings Per Share 
SLAS 35 Interim Financial Reporting  
SLAS 36 (issued 2000) Provisions, Contingent Liabilities And Contingent Assets 
SLAS 37 (issued 2002) Intangible AssetsThis is consistent with the original version of IAS 38, but the IASB revised IAS 38 in 2004.
SLAS 40 (revised 2005) Investment Property 
SLAS 41 (Revised 2005) Impairment of Assets 
SLAS 42 Accounting and Reporting by Retirement Benefit Plans 
No corresponding SLASSri Lanka has not adopted an equivalent of IAS 29 Financial Reporting in Hyperinflationary Economies
No corresponding SLASSri Lanka has not adopted an equivalent of IAS 32 Financial Instruments: Disclosure and Presentation
No corresponding SLASSri Lanka has not adopted an equivalent of IAS 39 Financial Instruments: Recognition and Measurement
No corresponding SLASSri Lanka has not adopted an equivalent of IAS 41 Agriculture
No corresponding SLASSri Lanka has not adopted an equivalent of IFRS 1 First-time Adoption of IFRSs
No corresponding SLASSri Lanka has not adopted an equivalent of IFRS 2 Share-based Payment
No corresponding SLASSri Lanka has not adopted an equivalent of IFRS 4 Insurance Contracts
No corresponding SLASSri Lanka has not adopted an equivalent of IFRS 6 Exploration and Evaluation of Mineral Assets
No corresponding SLASSri Lanka has not adopted an equivalent of IFRS 7 Financial Instruments: Disclosure

September 2004 Update
As a result of a policy decision recently adopted by the Sri Lanka Accounting and Auditing Standards Monitoring Board (SLAAMB), listed companies in Sri Lanka may choose to prepare their financial statements in accordance with International Financial Reporting Standards, rather than Sri Lankan GAAP. We have modified our Table of Use of IFRSs by Country accordingly.

October 2000 Update
The Institute of Chartered Accountants of Sri Lanka is continuing its policy of harmonising Sri Lanka Accounting Standards (SLAS) with IAS.

The following SLASs came in to effect from 1 April 2000.

  • SLAS 3 Presentation of Financial Statements. This Standard replaces the following: SLAS 3 Disclosure of Accounting Policies and SLAS 15 Presentation of Current Assets and Liabilities
  • SLAS 28 Segment Reporting. This Standard replaces SLAS 28 Reporting Financial Information by Segment
  • SLAS 34 Earning per Share

Further Sri Lanka Accounting and Auditing Standards Act No 15 of 1995 came in to effect in respect of periods commencing on or after 1 January 1999. The Act applies mainly to the preparation, presentation, and audit of financial statements of specified enterprises in respect of periods commencing on or after1 January 1999. The Act imposes certain duties and obligation on specified business enterprises and their directors, officers, and auditors, the default of which would result in various penalties, extending up to an imprisonment of either description for a term of 5 years.


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