The Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka), as a member of the International Accounting Standards Committee (IASC) is committed to IASC's broad mission of the development and enhancement of accounting standards.
In working towards this mission, IASC develops and issues International Accounting Standards (IAS). IASC believes that the issue of such standards will help to improve the degree of uniformity of accounting throughout the world.
As a condition of its membership of IASC, CA Sri Lankais obliged to support the work of IASC by informing its members of IAS, to work towards implementation to the extent possible of IAS, and specifically to incorporate IAS in Sri Lanka Accounting Standards (SLAS).CA Sri Lanka members are expected to comply with SLAS. Failure to do so may result in CA Sri Lanka inquiring into a member's conduct.
It is impractical to establish accounting standards which universally apply to all situations and circumstances an accountant may encounter. Therefore accountants should consider SLAS as the basic principles which they should follow in performing their work.
The Sri Lanka Accounting and Auditing Standards Act, No. 15 of 1995 which authorises CA Sri Lanka to issue SLAS, requires "specified business enterprises" to prepare and present their accounts in compliance with SLAS, with the object of presenting a true and fair view of their financial performance and condition, and requires their auditors to report whether such accounts are so prepared and presented and to specify clearly any deviations there from along with the reasons therefore.
SLAS contain basic principles and essential procedures (in bold italic black letters), together with related guidance in the form of explanatory and other material. The basic principles and essential procedures are to be interpreted in the context of the explanatory and other material that provide guidance for their application.
To understand and apply the basic principles and essential procedures together with the related guidance,it is necessary to consider the whole text of SLAS including explanatory and other material contained in SLAS, not just that text which is bold italic black lettered.
SLAS need only be applied to material matters.
The penultimate paragraph of most SLAS states that compliance therewith ensures compliance in all material respects with the relevant named International Accounting Standard.
The last paragraph of each SLAS states its effective date.
