International accounting standards - now or later?
The Alternative Investments Market (AIM) has been an exchange-regulated market since October 2004. This means that AIM companies must now follow international accounting standards instead of EU approved standards. The question is, when to make the switch?

At BDO Stoy Hayward we have a large number of AIM- listed companies who face the international accounting standards dilemma.

The London Stock Exchange (LSE) ruling is clear: They have proposed amendments to the AIM rules which state that every AIM company must comply with international accounting standards for financial years that start on 1 January 2006 or thereafter. But taking up international accounting standards will not be enforced in consideration of accountancy periods starting on or beyond 1 January 2005, but before 1 January 2006.

This means that AIM companies do not have to adopt international accounting standards for another year.

However, AIM companies who persevere with UK GAAP in 2005 will have to meet the needs of the UK convergence Financial Reporting Standards (FRSs) which are effective for accounting periods in the year 2005.

AIM-listed companies therefore need to think about whether it is actually less disruptive to meet the needs of international accounting standards and FRS in one go or whether to have two changes in two consecutive years.

What’s our advice? Contact your local BDO Stoy Hayward adviser and let us assess the impact international accounting standards could have on your business.