KARACHI: President Institute of Chartered Accountants of Pakistan (ICAP) Syed Shabbar Zaidi has said the Securities and Exchange Commission of Pakistan will likely issue accounting standards for small and medium enterprises by June this year.
Addressing a press conference at ICAP head office on Thursday about the first accounting summit of South Asia scheduled for April 18 in Pakistan, he said the accounting standards, divided into two sections, had been prepared by the ICAP.
The first part will be related to small enterprises and the second part will cover medium enterprises. He was of the view the SMEs would get bank finances after the promulgation of notification on accounting standards “because this undocumented but the most important sector of national economy will be able to prepare their accounts as per standards.”
At the same time, bankers will find it easier to assess the balance sheets of small and medium enterprises. He said, “it is a great honour for Pakistan that Indian, Sri Lankan and Bangladeshi authorities have accepted and cleared these standards and will be following the same standards in their countries.”
He said the visit of Professor Sir David Tweedie, Chairman International Accounting Standards Board (IASB), was a testimony to the recognition of Pakistan’s accounting bodies. The IASB is a global standard-setting body, which develops and issues international financial reporting standards (IFRS) that are used for the preparation of financial statements by corporate entities. Over 100 countries have adopted and used these standards.
He said the ICAP Council had, in principle, decided to gradually adopt all IFRS by December 2007 so that Pakistan could become fully compliant with international standards. He said Pakistan would be one of the first countries in the region to become fully compliant with the IFRS. In the accounting conference, he added, key issues in the implementation of some of the complex IFRS would be addressed by experts.
Chairman Professional Standards and Technical Advisory Committee of ICAP, Asad Ali Shah, on the occasion, said there were great benefits of adopting the global financial reporting framework as it reduced the cost of capital, enhanced transparency and helped in attracting local and foreign direct investment.
He said the financial reporting framework was based on international best practices owing to coordinated efforts by the ICAP, SECP and State Bank. The South Asia conference would help in highlighting the competitive advantage of Pakistan at the international level, he said.