2. IFRS 19 focuses on disclosure of information about subsidiaries without public accountability. Subsidiaries can now prepare financial statements with significantly reduced disclosure requirements compared to those required by current financial reporting standards. This new standard also provides an additional option for subsidiaries currently preparing financial statements under the Thai Financial Reporting Standards for Non-Publicly Accountable Entities (TFRS for NPAEs). They can improve their metrics by transitioning to preparing financial statements in accordance with Financial Reporting Standards (TFRS) while reducing the burden of disclosure requirements.

Boonlert said Thai financial reporting standards should be updated in accordance with IFRS 18 and IFRS 19, effective for financial statements covering annual periods beginning on or after January 1, 2028. These updates provide companies with greater flexibility, particularly in the preparation of financial statements. for their subsidiaries. Management must choose between TFRS for NPAE or IFRS 19 when preparing financial statements to maximize collective benefits. The changes ensure that users receive more relevant and targeted information, improving their ability to analyze and compare entities’ financial statements.

Using GenAI for efficiency in accounting and finance

The adoption of Generative AI (GénAI) has grown exponentially in Thailand – and not just at the individual level. Many organizations are now leveraging GenAI across various dimensions of business, including to improve accounting and finance tasks. GenAI not only helps with financial document management and processing, but is also particularly effective in predictive financial analytics and prescriptive analytics.

This allows Financial directors (Financial directors) to gain deeper knowledge, make more informed decisions and strategically plan the organization’s finances effectively.

GenAI is used to improve efficiency and reduce operational costs across a wide range of industries. For example, in other countries, GenAI can facilitate investor relations by comparing industry data and drafting answers to investor questions. It can also be used for various M&A tasks, such as research, model building, and evaluating company valuations to provide options for business development departments.

“When implementing GenAI, leaders should start with a framework that aligns with business strategy. This is essential for assessing impacts and managing risks related to data governance. Support should be strengthened by starting with internal pilots and creating use cases to raise awareness. This is crucial to fostering an organizational culture that recognizes the potential of GenAI. At the same time, business leaders must also be aware of potential risks and implement a framework for responsible AI to ensure trust and transparency,” Boonlert said.

Evaluate whether ESG strategies impact financial reporting.

According to Boonlert, governments and regulatory bodies in many countries issue policies or regulations related to Environmental, Social and Governance (ESG). Although Thailand does not yet have comprehensive direct regulations similar to those in the EU, listed Thai companies are required to disclose their ESG performance in the One Report, alongside the financial report.

Therefore, Thai companies are beginning to study and adopt ESG practices within their organizations to drive long-term value creation and prepare for potentially stricter regulations. This includes emphasizing transparent and reliable reporting on sustainability, he said.

As a result, CFOs play a crucial role in managing and strategizing financial operations, sourcing financing and proposing various options that align with the organization’s ESG approach. They must also collect financial and non-financial data to ensure transparency of ESG reporting and monitor associated performance. All stakeholders must be informed of the ESG strategic plan.

One fundraising approach that aligns with ESG principles and is currently attracting considerable interest is the issuance of green financial instruments. These instruments incentivize organizations to engage in environmentally friendly activities, such as green labeling to support the reduction of carbon emissions and the use of clean energy sources to achieve net zero gas emissions. greenhouse.

Green activities significantly influence accounting practices, particularly in the classification and measurement of the fair value of financial instruments. It is the responsibility of the financial manager to evaluate and manage the financial results of these green financial instruments, as they can impact and cause fluctuations in the company’s profits or losses.

“CFOs must assess the impacts of different ESG plans on financial reporting. For example, improving business operations to address the effects of climate change could affect the availability of raw materials and natural resources, which would impact financial statements. This may include asset write-downs, fair value of assets and the ability to collect debts, particularly from debtors affected by climate change.

“In addition, investors and businesses are placing greater emphasis on climate change, with international investors seeking sustainability reporting to inform their investment decisions. Business leaders must follow accounting practices that ensure transparency, building trust in financial and non-financial information,” Boonlert said.