Shall we have international financial reporting standard?

It has been said that there would be an international standard for financial report in the future. The expected time may be 2009, 2010 etc.

With globalization for investment, it seems that we are going to have the ideal standard some day. Yet, I do believe that this would be applied to listed corporations only.

The situation for SMEs is different among all countries. Since SMEs have no public buying and selling of stocks, it is without any need to make them universally alike.

Of course, it is a best choice to have standardized financial reporting especially for those SMEs that may look for IPO in the future. With such reporting requirement, the management will be forced to develop. Certainly, there are many SMEs preferring to remain unchanged for everything including accounting. Remember that many SMEs are not employing any IT applications besides email etc.

There are more SMEs than listed corporations. May be we can apply the 80-20 ratio as average for most countries. With over 80% SMEs, we cannot hope that all of them would be able to develop for their business and accounting. That means they would rely on their auditors to prepare the reporting accordingly. This is not the best outcome and the standardization would become a routine description.

In fact, there are amendment for smaller listed corporations going on and we can see that it will take some years to have the final version of reporting standard.

Although I do not expect to have any international financial reporting standard in years for SMEs the world over, yet taking such as guidelines for regional standards is a certain result.