International Financial Reporting Standards (IFRS) is a standard set of information and principles which have been created to promote an efficient, transparent and consistent approach to financial reporting in the global market. IFRS was introduced in 2001 by the London-Based Accounting Standards Board (IASB) to replace the former International Accounting Standards (IAS). The rationale for this change was to provide a uniform set of principles and practices for financial reporting no matter what the company or the country.

Being the internationally accepted standard of global accounting, IFRS promotes enhanced corporate transparency through the publication of uniform financial statements that are understood in all countries regardless of local laws and regulations. This facilitates the comparability of financial statements across borders while also increasing the reliability of reported financial data.

IFRS helps users of financial statements, including investors, creditors and other stakeholders, to make informed decisions on financial matters. New global accounting provisions provide a much more complete picture of a company’s financial position. This is due to improved standards for the measurement and disclosure of balance sheet items, profit calculation and income statement format.

The 19 accounting standards within IFRS cover a wide range of topics, such as income statements, balance sheets and other financial statements. These standards provide guidance on how such statements should be prepared, as well as how they should be disclosed. They also provide more detail than IAS and thus cover more items. This includes guidance on how to identify, measure, recognize and disclose particular items.

Furthermore, the International Financial Reporting Standards system has the advantage of flexibility which allows companies the freedom to customize financial statements to their own specific needs. For example, a company may wish to include non-financial measures, such as customer satisfaction and product quality levels, in its financial report.

Despite the benefits of using internationally accepted standards for financial reports, it is important to note that not all countries adhere to IFRS. The U.S, for example, is one of the countries that uses its own Generally Accepted Accounting Principles (GAAP).

Overall, the International Financial Reporting Standards are designed to combat discrepancies in financial reporting and bring integrity to the international practice of accounting. They are implemented by the IASB and provide users of financial statements guidance on how to understand, measure, track and publicly disclose financial information.