Response to the following problem:
With countries around the world adopting IFRS, many argue that the IASB should tailor its standards to meet the needs of small enterprises. One view is that the board should create standards for SMEs, specifically those that do not have public accountability. Others, however, believe that full IFRS are suitable for all entities. The board also needs to determine which entities the IASB SME standards should be intended for. One view is that public accountability should be the distinguishing factor. Full IFRS, rather than SME IFRS, should be required for companies that are public. Others believe the IASB should set forth characteristics of SMEs and let individual countries determine whether the companies qualify as an SME. Another possibility would be to use a size test to determine the enterprise's classification.
1. Should the IASB develop a separate set of standards for SMEs or are existing IFRS suitable for all companies, should there be a distinction between small and large companies?