The International Financial Reporting Standards (IFRS) are a set of accounting standards developed by the International Accounting Standards Board (IASB), an independent, private-sector body based in London, United Kingdom. IFRS is designed to provide a common global language for financial reporting, enabling transparency, comparability, and consistency in financial statements across different countries and industries.

Key features of IFRS include:

Global Applicability: IFRS are used by companies in many countries as the basis for preparing their financial statements. They are particularly prevalent in countries that have adopted or converged with IFRS as their national accounting standards, including the European Union, Australia, Canada, and many others.

Principles-Based Approach: IFRS are principles-based rather than rules-based, broad principles and guidelines for preparing financial statements rather than prescribing specific rules for every accounting situation. This allows for more flexibility and judgment in applying the standards but also requires careful interpretation and application by preparers and auditors.

Comprehensive Coverage: IFRS cover financial reporting topics, including financial statements, revenue recognition, accounting for assets, liabilities, equity, leases, and financial instruments. The standards are continuously updated and revised by the IASB to reflect changes in business practices, economic conditions, and regulatory requirements.

Disclosure Requirements: IFRS include extensive disclosure requirements to ensure the financial statements provide relevant, reliable, and decision-useful information. They provide additional context, explanation, and transparency about the company’s financial position, performance, risks, and other significant matters.

Convergence Efforts: In recent years, there has been a trend towards global convergence of accounting standards, with many countries and regions moving towards adoption or convergence with IFRS. This convergence aims to enhance consistency and comparability in financial reporting and facilitate cross-border investment and capital flows.