The Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) is seen as a sovereign body mandated to develop and issue the Sri Lanka Accounting Standards (SLAS) for the financial sector preparers and users of declarations. The Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) in 2011 successfully adopted the International Financial Reporting Standards (IFRS) in the country on 1 January 2011 by issuing Sri Lanka Financial Reporting Standards (SLFRS) and Sri Lanka Accounting. The principles (LKAS) that consist in the preparation of financial statements in accordance with IFRS include the following: Balance sheet, Statement of comprehensive income, Statement of changes in equity, Statement of cash flows and Accounting policies. With the adoption of the new Sri Lanka Financial Reporting Standards, entities are required to apply IFRS 1 – First-time Adoption of Sri Lanka Financial Reporting Standards for annual financial years commencing on or after 1 January 2012. Sri Lanka Accounting and Auditing Standards Act no. 15 of 1995 defines a class of enterprises as specified commercial enterprises (SBE). SBE