Financial Reporting Standard for Large and Medium-Sized Entities (BOBİ FRS) 2021 Edition

Financial Reporting Standard for Large and Medium-Sized Entities (BOBİ FRS) 2021 Edition

The Financial Reporting Standard for Large and Medium-Sized Entities (BOBİ FRS (Turkish GAAP for SMEs)) was published by the Public Oversight Authority (KGK) on 29/7/2017 and entered into force on 1/1/2018 so that entities subject to independent audit that do not apply TFRS prepare financial statements that are fair, meet the need for financial information and are comparable.

Since the BOBİ FRS 2017 Edition entered into force, a need has been identified to improve some of its provisions, based on feedback from preparers, the Authority's review work, the review of financial statements uploaded to the Electronic Financial Reporting (EFR) system and the views of other stakeholders.

These improvements aim to increase consistency between sections and to clarify matters that were not explicitly regulated.

In this context, the draft text of the updates prepared as a result of the Authority's internal work was opened for comment by the relevant institutions and the public on 9/12/2020. After the draft was finalised in light of the comments received, the Board Decision on the BOBİ FRS 2021 Edition was published in Official Gazette No. 31439 (Duplicate) of 30/3/2021.

To make the changes in the BOBİ FRS 2021 Edition easy to follow and to preserve the existing paragraph numbers, newly added paragraphs (other than those added at the end of a section) have been numbered by adding a letter to the number of the preceding paragraph, and the numbers of deleted paragraphs have not been changed. The same approach has been followed for changes to sub-paragraphs.

On the other hand, high inflation has caused entities' financial statements to grow, which in turn has led to a significant increase in the number of entities falling within the scope of large entities. When the effect of inflation is removed, this increase in the number of large entities was seen to reverse. Therefore, in order to preserve the "Think Small First" approach, one of the core approaches of BOBİ FRS, it became necessary to update the large entity criteria (total assets and annual net sales), and this update was published in Official Gazette No. 32577 of 15/06/2024. The large entity thresholds applicable by period are shown in the table below.

*For example, when an entity assesses in 2024 whether it is a large entity, it should look at 2022 and 2023 using the criteria shown in the table: total assets of TRY 400 million or more, net sales of TRY 800 million or more and an average of 250 or more employees. In short, the criteria applicable to the year of assessment are identified, the previous two years are examined, and on that basis it is decided whether the entity is a large entity.

As a result of the periodic updates to the thresholds, the additional obligations in BOBİ FRS for large entities — the presentation of deferred tax, the preparation of consolidated financial statements and additional note disclosures — have become mandatory for fewer entities.

The current thresholds for identifying large entities have been incorporated into the BOBİ FRS 2021 Edition.

Announced to the public.