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Surveys on extended use of IFRSs in European Union

  • European Union (old) Image

01 May 2004

The European Union Accounting Regulation requires that European companies listed in a European securities market must use IFRSs to prepare their consolidated financial statements starting in 2005. EU countries have the option to: .

The European Union Accounting Regulation requires that European companies listed in a European securities market must use IFRSs to prepare their consolidated financial statements starting in 2005. EU countries have the option to:

  • Require or permit IFRSs for unlisted companies
  • Require or permit IFRSs in parent company (unconsolidated) financial statements
  • Permit companies whose only listed securities are debt securities to delay IFRS adoption until 2007
  • Permit companies that are listed on exchanges outside of the EU and that currently prepare their primary financial statements using a non-EU GAAP (in most cases this would be US GAAP) to delay IFRS adoption until 2007.
The European Commission has surveyed the 15 current EU member states, the 3 EEA member states, and the 10 additional countries that joined the EU as of 1 May 2004 (today) on their plans regarding the four options above. Here is an overview of the findings:

EC Survey on Member States' Use of Options in Accounting Regulation 18 Current EU and EEA Members: Virtually all of the 18 current EU and EEA members are going to permit, though not require, IFRSs for the consolidated statements of unlisted companies. Only 4 will permit IFRS for the parent company separate statements, 11 will not permit, and 3 are undecided. Regarding the 2007 deferral for debt-only listed companies, 6 have decided to delay, 5 probably will delay, and 7 will not delay. Two countries will permit companies to delay IFRSs to 2007 if their current primary GAAP is a non-EU GAAP, and several other countries probably will do so. 10 New EU Members: Two of the 10 new EU members, Cyprus and Malta, already require IFRSs for all companies. Of the 8 other new members, 6 will either require or permit at least some unlisted companies to use IFRSs, and 5 will require or permit IFRSs in the parent company separate statements.

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