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IFRS Foundation and International Financial Reporting Standards

IFRS Standards issued by the IASB, the framework body governing financial reporting in 140+ jurisdictions outside the United States.

IFRS8 min readLast reviewed: 2026-01Official source
IFRS Foundation and International Financial Reporting Standards

Scope

The IFRS Foundation is the not-for-profit body that oversees the International Accounting Standards Board (IASB), which issues IFRS Accounting Standards, and the International Sustainability Standards Board (ISSB), which issues IFRS Sustainability Disclosure Standards. IFRS Standards are the financial reporting framework required or permitted in more than 140 jurisdictions, including the European Union, the United Kingdom, Australia, Canada (for public companies), Brazil, and most of Asia. The notable exception is the United States, where US GAAP under the FASB Codification governs.

For US-domiciled multinationals with non-US subsidiaries, IFRS often shows up as the local statutory reporting framework in the subsidiary's jurisdiction, with consolidation back to US GAAP at the parent. Knowing both frameworks — and the gap between them — is core competence for cross-border finance work.

Structure

IFRS Standards are issued in two numbering conventions:

  • IAS — International Accounting Standards. The older numbering, used for standards issued before 2001 by the IASB's predecessor, the IASC. Examples: IAS 1 (Presentation of Financial Statements), IAS 2 (Inventories), IAS 16 (PP&E), IAS 36 (Impairment), IAS 38 (Intangibles).
  • IFRS — International Financial Reporting Standards. The current numbering, used for standards issued by the IASB since 2001. Examples: IFRS 9 (Financial Instruments), IFRS 15 (Revenue), IFRS 16 (Leases), IFRS 17 (Insurance Contracts).

Both naming conventions coexist; "IFRS" colloquially refers to the entire body of standards regardless of whether a specific rule is labeled IAS or IFRS.

US GAAP vs. IFRS — the practical gaps

For preparers crossing between the two frameworks, the differences that matter most in practice:

  • Inventory. IAS 2 prohibits LIFO. ASC 330 permits it. A US parent using LIFO will have to convert its non-US subsidiaries to FIFO or weighted-average for local statutory reporting.
  • Revenue recognition. IFRS 15 and ASC 606 were jointly developed and are substantively converged. The core five-step model is identical. Minor differences exist in collectibility thresholds and licensing.
  • Leases. IFRS 16 puts essentially all leases on the lessee's balance sheet as right-of-use assets. ASC 842 also puts leases on balance sheet but retains the operating-vs-finance distinction for P&L treatment. The mechanical accounting differs.
  • Impairment. IAS 36 uses a one-step recoverable amount test. ASC 350/360 uses a two-step process with separate qualitative and quantitative steps. The trigger events are similar; the mechanics differ.
  • Development costs. IAS 38 requires capitalization of qualifying development costs. ASC 730 generally requires immediate expense of all research and development. This is one of the largest single P&L impacts when converting between frameworks for software, pharma, and engineering firms.
  • Goodwill. Both require impairment testing rather than amortization for public companies, but the mechanics differ. ASC 350 allows a qualitative ("Step 0") assessment; IAS 36 doesn't.

Conceptual Framework

IFRS has a published Conceptual Framework (most recently revised in 2018) that provides the principles underlying the standards: the objective of financial reporting, qualitative characteristics, the elements of financial statements, recognition and derecognition criteria, measurement bases, and the concept of capital maintenance. Unlike a specific standard, the Framework is not authoritative — preparers fall back to it only when no IFRS Standard specifically addresses a transaction.

How IFRS is updated

The IASB issues amendments and new standards through a public due process: discussion paper, exposure draft, comment period, final standard. Effective dates are typically 18–36 months after issuance to allow for implementation. Major recent issuances:

  • IFRS 18 — Presentation and Disclosure in Financial Statements (effective 2027). Replaces IAS 1.
  • IFRS 19 — Subsidiaries without Public Accountability (issued 2024). Reduced disclosure framework.
  • IFRS S1 and S2 — Sustainability disclosure standards from the ISSB (issued 2023).

Common pitfalls

  • Treating IFRS as monolithic. IFRS allows policy choices (cost vs. revaluation model for PP&E and intangibles; FIFO vs. weighted-average for inventory). Two IFRS reporters can produce different numbers and both be compliant. Always ask which option a particular entity has elected.
  • Assuming convergence is complete. IFRS 15 and ASC 606 are largely converged on revenue, but the rest of the standards diverge in meaningful ways. A "convert IFRS to US GAAP" project is real work even for standards that look similar on the surface.
  • Statutory vs. management reporting. A US-parented group operating in IFRS jurisdictions usually maintains two sets of books: IFRS for local statutory filing, US GAAP for consolidation to the parent. Both have to be reconcilable. Building this reconciliation discipline from day one is much easier than retrofitting it during a Big 4 audit.

Access

IFRS Standards are published by the IFRS Foundation. The standards themselves are available through paid licensing for most use cases; summaries and the Conceptual Framework are freely available at ifrs.org. Many EU and Commonwealth jurisdictions have free national-language versions through their local accounting bodies.

Related references

  • FASB ASC — the US GAAP counterpart
  • ASC 606 / IFRS 15 — Revenue
  • ASC 842 / IFRS 16 — Leases
This summary is an operator's working reference. For authoritative guidance, consult the official source at https://www.ifrs.org/issued-standards/list-of-standards/. Updated: 2026-01.