The impact of accounting policies on smes. changes in accounting estimates and correction of errors

Abstract

The tendency to deregulate commercial relations, strengthen financial institutions, diversify markets, use electronic transfer of information, resources and globalize business operations has recently gained particularly important. In this context of internationalization of trade, convergence towards International
Financial Reporting Standards (IFRS or NIIF) has become necessary to prepare and present financial information, a key element of the accounting process that has broad consequences for decision making, given the relevance and reliability that financial information must contain.

We describe how IFRS (NIIF) define accounting policies, the changes in accounting estimates, and the correction of errors as a guide for their application; we also reveal the requirements of financial information for accounting policies, estimates and errors. We particularly emphasize on their specific nature with a
business plan, the transactions made by the entity, the events (risks) and conditions (contracts) allowed  y those in charge of managing them (the Board of Directors, the Audit Committee and the CFO (Chief Financial Officer)) by supplying useful information for decision-making by different users.