An investigation into the benefits and challenges of International Financial Reporting Standards (IFRS) adoption and implementation amongst small and medium enterprises in Kumasi metropolis

Abstract

This paper provides empirical evidence regarding the perceived investigation into the benefits and challenges of international financial report standard adoption and implementation amongst small and medium enterprises in Kumasi metropolis. The Ghanaian financial reporting framework is keeping pace with the global development due to the globalization of the world’s economy and markets led companies and nations to become world global players. Thus, as a result, Ghana made preparation and effectively launched the International Financial Reporting Standards (IFRS) on January 23, 2007 and other bodies were given a supplementary changeover period of two years to comply (United Nations, 2007), to make sure that all companies and Small and medium Scale Enterprise report or prepare their financial statement base on International Financial Reporting Standards (IFRS) for Small and medium Scale Enterprise in Ghana. . This study contributes to the limited empirical research regarding the investigation into the benefits and challenges of international financial report standard adoption and implementation amongst small and medium enterprises in Kumasi metropolis in particular. In addition, International Financial Reporting Standards (IFRS), different countries developed their own national accounting standards or adopted that of other countries. However, movement of business toward a global economy brought challenges in comparability, objectivity, reliability, understandability among others. These issues have accelerated the need to move toward global accounting standards. Thus these challenges spelt the need for a single set of high quality and globally accepted accounting standards. This study recommends that, the SMEs in Kumasi Metropolis, Ghana should work on skills and expertise gap through training and development and to ensure that these standards are included in the academic and professional curricula. Moreover, regulatory bodies should monitor and enforce these standards but where local content is needed, convergence should be the solution.