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0 votes

Please refer to Page iii of the HK SME-FRS, which states that:

SME-FRF and SME-FRS should be read in the context of the Preface to Hong Kong Financial Reporting Standards. SME-FRS should also be read in the context of the SME-FRF.

Which on our understanding is that, if any situations not covered by SME-FRS, you can refer to: Hong Kong Financial Reporting Standards.

asked by (8.2k points)

3 Answers

0 votes

Some opinion is that when situation not covered by SME-FRS, the CPA in charge should use his Professional skepticism and make professional judgement, which in our understanding, this opinion can also be concluded to refer to HKFRS.

answered by (8.2k points)
0 votes

Standard reference:

In the event that the SME-FRS does not cover an event or a transaction undertaken by an entity, management may consider the SME-FRF for guidance on developing an appropriate accounting policy, consistent with the historical cost convention, for that particular event or transaction.

(Paragraph 1.2 of SME-FRS)

answered by (8.2k points)
0 votes

Example of situations not cover by SME-FRS:

Derivatives, forex and swaft, which is not cover by Section 6 Investment of SME-FRS (SME-FRS doesn't have Financial Instrument section), should be accounted using fair value model, by referring to Full GAAP.

answered by (8.2k points)
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