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UK unlikely to depart from IFRSs if it intends to remain a global player

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Jul 01, 2016

On July 1, 2016, the Institute of Chartered Accountants of Scotland (ICAS) released some additional responses to the 20 questions it posed on June 24, 2016 about the impact of 'Brexit' on business and trade, including on accounting and audit.

Responses released on July 1, 2016 include thoughts on the following question:

In areas of accountancy, what new policies will follow? Will [the UK] be inclined or persuaded to depart from International Financial Reporting Standards (IFRS) and re-establish UK Generally Accepted Accounting Practice (UK GAAP)?

The ICAS staff argue that if the UK intends to remain a global player, "then one would expect that it would need to require listed entities to comply with global standards in the area of financial reporting". They state:

IFRS is now seen as the global benchmark in terms of financial reporting standards and therefore their use, or the use of standards substantively based on the IFRS framework (adopted standards), would appear to be the primary option.

However, the ICAS staff points out that following its exit, the UK would have the ability to sadopt IFRS standards as issued by the IASB without them firstly having to be adopted by the EU. They also explain that the UK could establish its own adoption mechanism, possibly via the Financial Reporting Council (FRC).

Please click for the following information on the ICAS' Web site:

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