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THAILAND
Martin Klose/Patcharee Sabangban
Thailands Convergence to IFRS
Introduction
In April 2001, the International Accounting Standards Board (IASB) was founded to undertake the responsibilities of the International Accounting Standards Committee (IASC), established in 1973. In 2002, a year after its establishment, the IASB united with the Financial Accounting Standards Board (FASB) to combine their knowledge and develop a set of accounting standards, the so-called International Financial Reporting Standards (IFRS). This replaces certain Internatio nal Accounting Standards (IAS) and would be compatible with all countries in order to successfully carry out international business affairs and their accounting.
Currently, over 100 countries across the world require or permit the use of IFRS as the globalization of businesses has steadily increased. This has caused a growing acceptance of a generalized set of standards for accountants and financial statements/reports users, especially for international investors and bankers (KPMG 2010). In addition, reporting in accordance with IFRS is also considered as a competitive tool in benchmarking the businesses by financial information users, in particular with regards to the potential cost savings for multinational companies in preparing the consolidated financial statements for their group.
Contrary to major economic leaders, Thailand is one of many countries which has voiced concerns about the convergence with or full adoption of IFRS for some time. Now, it has announced the plan to become fully compliant with Thai Accounting Standards (TAS) adopted from IFRS. This transition was initiated by its own Accounting Standard Board the Federation of Accounting Profession under the Royal Patronage of His Majesty the King (FAP), founded in 2004. It replaces a long established Institution of Accountants and Auditors of Thailand (ICAAT) and is in coordination with Thai Securities Exchange Commission (Thai SEC) and Security Exchange of Thailand (SET). Besides FAP, SEC and SET, the Department of Business Development (DBD) also partici pated in the transition process by issuing The Brief Particulars in the Financial statements B.E. 2551 which ensured that it corresponded with the revised TAS 1 and finally the IAS 1 from 1st of January 2009 onwards (Presentation of Financial Statements Bound 2009). The direct consequence of this was an enormous r eluctance to prepare of the companies financial statements in conformity with IFRS.
Therefore, it is reasonable, that the impact...