Success of IFRS 10 in Reducing Diversity in Consolidation Reporting Practices

IFRS 10

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
Evaluating success of IFRS 10 in reducing the diversity in reporting practices related to
consolidation................................................................................................................................1
Assessing the challenges with current standards and mentioning improvements which IASB
should consider in future meeting................................................................................................3
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
IFRS refers to the international financial reporting standards which has set of accounting
rules for public companies that are intended to make functioning of these companies transparent
and easily comparable. In the current era, competition has inclined which is overcome by firms
via taking non ethical practice that has adverse impact on interest of different stakeholders.
IFRS has been implemented to ensure that proper and fair presentations of financial information
is published by public companies so that significant level of ethical working environment can be
created. Present report will focus on explaining success of IFRS 10 in reducing the diversity of
reporting practices related to consolidation. The current stud will highlight challenges with the
present standard & suggesting crucial improvements IASB can consider along with illustrating
examples of Unilever.
MAIN BODY
Evaluating success of IFRS 10 in reducing the diversity in reporting practices related to
consolidation
International financial reporting 10 has been published for making crucial improvements
by establishing few principles for preparing consolidated financial statements (IFRS 10
Consolidated Financial Statements, 2021). It is for providing the accounting guidelines related
to consolidated and joint venture so that significant level of practices can be followed by them.
It is formulated for those entities that control one or more other organizations. According to the
IFRS 10 the parent organization to have parent consolidated financial statement, defining
principle of control as the basis, setting out application of principles to identify where investor
controlling investing or not. In addition to this, defining investment entity and exception to
consolidate particular entity.
Unilever is one of the larger company of UK that has published its consolidated
financial statement on in December 2020 and have compliance with IFRS 10 to formulate its
consolidated financial statement. The company has given emphasis on formulating and
presenting the income, financial position, statement of changes in equity and cash flow
statement. The company has consistently applied accounting policies which were used in 2019.
From the evaluation it can be specified that IFRS has been published for eliminating the divers
course of action adopted by subsidiaries of parent company so that proper level of assessing
financial health can become possible (Lopes and Lopes, 2019). The main purpose for
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