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Audit practitioners and the Ceylon Chamber of Commerce on behalf of private companies have expressed concern regarding the Sri Lanka Accounting Standards to the Institute of Chartered Accountants of Sri Lanka (ICASL).

They have asked whether it is justified in requiring private companies to comply with the same set of accounting standards applicable to listed companies, since most private companies may be family owned or managed; do not have too many outside or public stakeholders and do not approach the regional or global capital market.

Considering this issue, the Statutory Accounting Standards Committee appointed in terms of Section 8(1) of the Sri Lanka Accounting and Auditing Standards Act No. 15 of 1995, is currently in the process of reviewing the Standard, the ICASL said in a news release.

The Act requires every Specified Business Enterprise (SBE) to prepare its financial statements in compliance with the Sri Lanka Accounting Standards. It mandates the ICASL to adopt and publish, from time to time, Sri Lanka Accounting Standards, as may be necessary for the purpose of maintaining a uniform and high standard in the preparation and presentation of accounts of the SBEs.

The Sri Lankan standards are largely based on the corresponding International Accounting Standards set by the International Accounting Standards Board. The international standards are designed, in the public interest, as a single set of understandable and enforceable global accounting standards that require high quality, transparent and comparable information in financial statements and other financial reporting to help participants in the world's capital markets and other users make economic decisions.

The ICASL has called for written comments from interested parties on the Sri Lanka Accounting Standard for Smaller Enterprises as part of its due review process, before adopting the Standard. The comments, in addition to any conceptual issues, should deal with practical problems, if any, arising from the application of the Standard.

The comments must be forwarded to the ICASL Technical Directorate on or before May 15. Comments can also be e-mailed to [email protected].

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