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ACCA Applied Knowledge · Financial Accounting · The regulatory framework

In a jurisdiction where IFRS Accounting Standards have not been adopted into national law, which statement about a listed company's financial statements is most accurate?

The company must obey local company law and any locally required standards. IFRS only apply where adopted or required, and the company may state IFRS compliance only if it follows every applicable standard. IFRS do not override law, and listing rules are not the sole source.

  1. AThe company must follow local company law and any local standards required, and may only claim IFRS compliance if it complies fully with IFRSCorrect
  2. BThe company may claim IFRS compliance while departing from selected standards
  3. CIFRS automatically override local company law
  4. DListing rules are the only source of requirements

Explanation

Legal and local requirements apply in a jurisdiction, and IFRS has no authority unless adopted or required. An entity can only state compliance with IFRS if it complies with all applicable standards. Claiming compliance while departing from some standards is not permitted, and IFRS do not override law.

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