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Brussels forum to inform international research on key issue

18 Jan 2010

Business reporting for small and medium-sized enterprises (SMEs) was the topic of discussion at a roundtable co-hosted by ACCA on 12 January 2010.

The purpose of the event - jointly organised with the International Association for Accounting Education & Research (IAAER) - was to develop an understanding of the value and impact of reporting by private entities, as well as contribute to the international research agenda by identifying a number of issues surrounding access to finance.

In his speech to delegates, which included standard setters, technical experts, EU policy makers, senior academics, as well as representatives of businesses and financial services institutions, Paul Pacter, IASB director of standards for SMEs, highlighted the simplicity of the new IFRS for SMEs and its design 'specifically for the needs and capabilities of small companies'. He emphasised its many benefits, such as an 'improved access to capital and an improved quality of reporting when compared to national GAAP'.

Meanwhile, Professor Dr Brigitte Eierle, chair of international accounting and auditing at the University of Bamberg (Germany), focused on the progress of empirical research in SME financial reporting. She acknowledged the significant gap in the literature available on the subject compared to capital market based research for listed entities, and discussed how the vast majority of studies focus on SME managers rather than on users, with these mostly being restricted to banks.

Professor Eierle stressed that 'further research is required on micro-entities and on external users' information needs', and called for an 'improvement in the comparability of data’, which has so far proved difficult due to the lack of an agreed standard definition among countries of what defines an SME.

Professor Robin Jarvis, ACCA's head of small business affairs and chair of the roundtable, praised the format of the discussion, which encouraged a lively exchange of views.

'This event followed on from an ACCA roundtable in New York, and one is also planned for South Africa to offer a truly global picture of the issue,' said Professor Jarvis. 'The outcomes of the three roundtables will enable ACCA - in collaboration with IAAER - to commission an internationally-focused research study.'