Today, International Financial Reporting Standards create conditions for the accessibility of reporting information for foreign users. In addition, this is a direct way to reduce the company's costs of raising borrowed funds. It is known that foreign sources of loans are significantly cheaper than domestic ones.
There are several aspects explaining why it is beneficial for an enterprise to use IFRS. Thus, indicators reflected in the consolidated reporting under international standards can be applied in budgeting; evaluating business development strategy; planning changes, etc.
There is a stable link between 'investment and IFRS reporting'. Investors are interested in greater transparency – this significantly reduces their risks. To ensure this rule is followed, investors are willing to slightly reduce their income. The use of this advantage by different countries is possible when implementing international standards into national accounting. IFRS reporting helps obtain international loans, borrowings, and investments, which are cheaper and provided for a longer period.
Companies that have already implemented IFRS use its principles, which allow the enterprise to make its activities more transparent. International standards are not limited by rigid rules, but provide an opportunity to be guided by unified accounting principles used by economic entities around the world. Today, global stock exchanges rely on reports compiled in accordance with IFRS requirements (an example is the London Stock Exchange).
Today, IFRS is used in most countries of the world. Countries developing their own requirements apply international reporting standards (for example, China, CIS countries and Central Europe). All companies listed on national stock exchanges have the right to use IFRS. Most financial institutions lend to enterprises only if they have a report that meets international standards (primarily the World Bank, IMF, EBRD).