There is no proposal to make small and medium enterprises adopt International Financial Reporting Standards (IFRS), the Lok Sabha was informed today.
"In view of the complicated and high cost nature of compliance with IFRS, it is not suitable for small and medium enterprises at present," Minister of State for Micro, Small and Medium Enterprises Dinsha Patel said.
As per the roadmap laid out by the Ministry of Corporate Affairs earlier this year, small and medium companies are not mandated to prepare account books as per the global IFRS accounting practices. However, they can voluntarily opt for convergence if they want.
There are 2.6 crore MSME units in the country, of which 1.86 crore are in the services space.
The MSME sector contributes 8 per cent to the GDP, 45 per cent to the country's manufactured output and 30 per cent to exports.