Sri Lanka National Professional Organisation Website: The Institute of Chartered Accountants of Sri Lanka National Professional Oversight Body Website: Sri Lanka Accounting and Auditing Standards Monitoring Board Response to IFAC Member Body Survey on Standard Setting and Regulation World Bank ROSC Accounting and Auditing Report Update for August 2007 Update for April 2006 Update for September 2004 Update for October 2000 Financial Reporting Framework in Sri Lanka (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 Standard Remarks Relating to IASs/IFRSs Framework for the Preparation and Presentation of Financial Statements   SLAS 03 (revised 2005) Presentation of Financial Statements Reflects 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 Costs Not 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 Investments This is equivalent to the old IAS 25, which was replaced by IAS 39 SLAS 23 Revenue Recognition and Disclosures in the Financial Statements of Banks Disclosure 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 Plantations No corresponding IAS SLAS 33 Revenue Recognition and Disclosures in the Financial Statements of Finance Companies No 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 Assets This 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 SLAS Sri Lanka has not adopted an equivalent of IAS 29 Financial Reporting in Hyperinflationary Economies No corresponding SLAS Sri Lanka has not adopted an equivalent of IAS 32 Financial Instruments: Disclosure and Presentation No corresponding SLAS Sri Lanka has not adopted an equivalent of IAS 39 Financial Instruments: Recognition and Measurement No corresponding SLAS Sri Lanka has not adopted an equivalent of IAS 41 Agriculture No corresponding SLAS Sri Lanka has not adopted an equivalent of IFRS 1 First-time Adoption of IFRSs No corresponding SLAS Sri Lanka has not adopted an equivalent of IFRS 2 Share-based Payment No corresponding SLAS Sri Lanka has not adopted an equivalent of IFRS 4 Insurance Contracts No corresponding SLAS Sri Lanka has not adopted an equivalent of IFRS 6 Exploration and Evaluation of Mineral Assets No corresponding SLAS Sri Lanka has not adopted an equivalent of IFRS 7 Financial Instruments: Disclosure 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. 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 harmonizing Sri Lanka Accounting Standards (SLAS) with IAS. The following SLAS's 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.