“Implementation of IAS and IFRS standards to improve the financial reporting of SME’s

Abstract

This study examines the research and implementation of the standards by the chosen organization Pakistan Sweet Homes. The total time duration allotted to us to finish the project was approximately 3 months, but COVID-19 disturbed the whole planning and strategy of the project. The pandemic made us into a challenging situation as mainly our project was to get the knowledge of the project by visiting to the organization. We faced a lot of issues in visiting the organization even after the lockdown was finished but we managed it by making new strategies and questionnaires to get out of this challenge. Financial statements were the key essence in our project. It was easy for us arrange the financial statements as the organization we chose was an NPO and to extract the information needed for the project. Questionnaires were used to extract the maximum of the information and getting the project to an end with a conclusive result by the research. We interviewed two of the personnel of Pakistan Sweet Homes through questionnaires. Professional Skepticism approach was used for the identification of the issues present within the system of the organization due to weak controls. Our finding indicates that the standards were not properly followed by the organization as there was a presence of non-compliance of the standards. As our study was related to research the issues in non-compliance of the standards, we discovered total six issues due to improper implementation of the standards. After discovering the issues within the organization, we suggested the standards, which are to be followed to rectify the arisen issues so that the financial reporting of the organization can be improved. To conclude, after all the hard work and our analysis, we generalized our research to say that the reason for the arisen issues, is a lack of check and balance by the regulatory bodies. Proper instruction should be provided, and implementation of standards should be reviewed, to avoid such issues and corruption leading due to such issues. These issues lead to improper figures within the financial statements and this may be because of faulty act in implementation of the standard due to lack of knowledge or by intentional reasons to do corruption.