International Accounting Standards Widely Used, Study Finds

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By David R. Jones

July 25 — About half of the 48,000 domestic companies listed on the 85 major securities exchanges worldwide use international financial reporting standards, the IFRS Foundation says.

The London-based foundation—which oversees the work of the International Accounting Standards Board—estimated in a July 25 analysis that most or all of nearly 25.000 companies on the World Federation of Exchanges and the Federation of European and Asian Stock Exchanges must use IFRS.

Basis for Conclusions

The foundation arrived at its conclusions by combining information on IFRS use in its jurisdiction profiles with data about the number of listed companies published on the two associations' web sites through late 2015.

Together, the two security-exchange groups tallied 47,818 domestic listed companies, of which 24,823 operate in jurisdictions that require IFRS use by all or most companies.

International accounting standards are permitted or required for at least some of an additional pool of 3,752 companies.

‘Small Margin of Error.'

The analysis is based on assumptions about IFRS use that offer a “reasonable”—though not necessarily foolproof—estimate of the number of companies using international standards worldwide, the foundation said.

“We believe that the margin for error due to those assumptions is small and does not materially affect the IFRS adoption picture,” it said.

Using Local Standards

Another listed 18,553 companies aren't required or permitted to use IFRS. Instead, they use local standards, of which 80 percent are listed in China, India, Japan and the U.S.

The foundation said 690 companies are listed in jurisdictions without a known accounting framework.

Foreign Listed Companies

Some jurisdictions allow but don't require IFRS use by foreign listed companies,the analysis said, though their numbers are relatively small.

“We are working to get better data on the choices that foreign listed companies have made,” the foundation said.

Continuing Growth in IFRS Use?

The number of listed companies using international accounting standards is set to grow as more jurisdictions adopt IFRS (09 APPR 1004, 11/22/13).

Saudi Arabia, for instance, currently requires financial institutions to use IFRS, but currently doesn't set the same obligations for all listed companies.

The country, however, “is in the process of adopting IFRS Standards as a requirement for all listed companies effective in 2017,” the analysis said.

To contact the reporter on this story: David R. Jones in London at

To contact the editor responsible for this story: Steven Marcy at

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