---
title: "IFRS"
description: "What IFRS is, who issues it, where it is required, the key standards for everyday bookkeeping (IAS 1, IAS 2, IFRS 15, IFRS 16) and how it shapes your accounts."
canonical: https://ledgeriano.com/glossary/ifrs
language: en
publisher: "Ledgeriano"
updated: 2026-11-06
---

# IFRS

> What IFRS is, who issues it, where it is required, the key standards for everyday bookkeeping (IAS 1, IAS 2, IFRS 15, IFRS 16) and how it shapes your accounts.

IFRS, the International Financial Reporting Standards, are accounting standards issued by the International Accounting Standards Board (IASB) for general-purpose financial statements. More than 140 jurisdictions require or permit them, mostly for listed companies, which makes IFRS the most widely used financial reporting framework in the world.

IFRS is principles based: it sets recognition, measurement, presentation and disclosure rules and expects judgement in applying them. The set includes older IAS standards that remain in force and newer IFRS standards, plus interpretations from the IFRS Interpretations Committee.

For day-to-day bookkeeping, a handful of standards matter most: IAS 1 for the structure of the primary statements (being replaced by IFRS 18 for periods from 1 January 2027), IAS 2 for inventory, IAS 16 for property, plant and equipment, IAS 21 for foreign currency, IFRS 15 for revenue and IFRS 16 for leases.

An IFRS-aligned chart of accounts groups accounts so the statement of financial position and the income statement by function or nature can be produced directly. The [IFRS chart of accounts template](https://ledgeriano.com/templates/ifrs-chart-of-accounts) is a ready starting point, and the [financial statements guide](https://ledgeriano.com/guides/financial-statements) explains the statements Ledgeriano builds from it.

## Example: IFRS vs local GAAP on inventory

A company that used LIFO under US GAAP converts to IFRS. IAS 2 does not permit LIFO, so it restates inventory using FIFO or weighted average cost. If LIFO inventory was 400,000 and FIFO gives 460,000, opening retained earnings increase by 60,000 before tax effects.

### Is IFRS mandatory for private companies?

Usually not. Most jurisdictions require full IFRS only for listed companies and banks. Private companies may use IFRS for SMEs or local standards, depending on local law.

### What is the difference between IAS and IFRS?

IAS were issued by the IASB's predecessor until 2001; IFRS are issued by the IASB since then. Both are part of the same body of standards and many IAS are still in force.

Guide: https://ledgeriano.com/guides/financial-statements