The Micro Accounting Model (MAM), developed by the Institute of Singapore Chartered Accountants (ISCA), is designed to facilitate micro, small and medium businesses (MSMEs) operating in ASEAN to adopt accrual accounting. 

Majority of the local businesses in emerging and developing countries use some form of traditional cash accounting method to record business transactions and to keep track of its financials. The objective of this self-contained framework is to assist these businesses in taking the first but important step in preparing reliable financial information using accrual accounting principles, consistent with the International Financial Reporting Standards (IFRS). 

The model contains significant simplifications to a number of areas, including accounting for financial instruments. But at the same time, it keeps within the confines of pervasive principles derived from the International Accounting Standards Board (IASB)’s conceptual framework and full IFRSs. It also lays out principles that encourage the use of judgment in the particular circumstances of a transaction or event. In addition, it includes a set of illustrative financial statements and reconciliations to IFRS and IFRS for SMEs. 

I strongly encourage emerging and developing countries, in particular, the standard setters and national professional accountancy bodies, to use this guide as a starting point towards eventually adopting international accounting standards. I envisage that the government of these countries will find MAM a useful tool in helping to raise the overall standards of the profession, thereby, contributing towards stronger investor confidence towards the country. Furthermore, as more businesses are encouraged to use MAM to produce quality, reliable financial information, governments would also have greater assurance over tax collections. 

This project would not have been possible without the inputs from ASEAN Federation of Accountants’ (AFA) Accounting Standards Group (AASG) members. Also, I would like to express my sincere appreciation to the author of MAM, Ms. Lim Ju May, ISCA’s Deputy Director, Corporate Reporting & Ethics (CoRE) Division, for devoting her time and effort towards ensuring that the MAM is intuitive and easy to understand. 

I hope you will find this document useful. 

Gerard Ee
President, Institute of Singapore Chartered Accountants (ISCA)
Chairperson, AFA Accounting Standards Group (AASG)

To access MAM, please click here