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ACCA Strategic Professional · Strategic Business Reporting (International) · Discussion of issues in financial reporting

A jurisdiction's securities regulator wants to adopt IFRS Accounting Standards for listed groups. Which statement about the role of the IFRS Interpretations Committee in supporting consistent application is correct?

The Interpretations Committee deals with application questions by developing interpretations, which the IASB must approve, and publishing agenda decisions explaining how existing standards apply. It does not issue standards, enforce compliance or audit; those functions belong to the IASB, regulators and auditors respectively.

  1. AIt issues new IFRS Accounting Standards directly without IASB involvement
  2. BIt provides authoritative interpretations and agenda decisions on application questions, with its interpretations requiring IASB approvalCorrect
  3. CIt enforces compliance and penalises non-compliant entities
  4. DIt audits the financial statements of listed groups

Explanation

The Committee addresses application questions and issues IFRIC Interpretations, which need IASB approval, as well as agenda decisions explaining how standards apply. It does not issue standards, enforce compliance or audit; enforcement lies with national regulators.

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