After the issuance of the IFRS for SMEs, the AASB launched its Differential Reporting Project. This introduced a regime that allows reporting entities with no public accountability (mainly large private companies) to adopt reduced disclosure requirements (Tier 2). Con- trary to the actions of many countries around the world, the AASB chose not to endorse the IFRS for SMEs. Student A supports the view of the AASB in favour of a reduced disclosure regime and re- jects the IFRS for SMEs as not appropriate for Australia Student B argues that these Australian companies should have been given the choice to ei- ther continue to use full IFRS or else adopt the IFRS for SMEs depending on their circum- stances, and there was no need for a distinctive Australian regime. SMEs play a significant role in economy especially in Australia where SMEs make of majority of businesses operating in Australia. The nature these enterprises, their financial position and their organisational structure require creative strategies on the behalf of regulatory bodies. There is no one agreed upon definition of an "SME" however it is the general consen- sus that size alone does not determine whether or not a business is an SME. Generally SME are entities that do not have public accountability and do not publish general-purpose fi- nancial statements for external users. In 2009 the IASB issues a separate accounting standard for companies without public ac- countability and the standard was dubbed, 'IFRS for SMEs'. Its objective was provides enti- ties a standard where they have no need for full IFRS due to unnecessary burden of high costs of compliance (of full IFRS) and lack of relevance (decision-usefulness has little impor- tant where there are no external users of financial reports). The main objective of international convergence is to eliminate national differences in ac- counting methods of transactions and events thus allowing financial statements of SMEs around the global becoming more comparable with one another. This would also drive for- ward the international adoption of IFRS, reducing costs and implementation and allowing for enhanced comparability. With international convergence, there would also be an in- crease in the quality of financial reporting and reduces costs for each country who would otherwise have to construct their own standards. In saying that, arguments against international convergence are rife and focus on issues pertaining to the 'one size fits all ' approach given the diversity of different SMEs around the globe. The standard may be unnecessarily complex for entities in developing countries in ad- dition to lacking qualified financial professionals to implement the standard. It would be more appropriate for industrialised nations to design their own standard in response to lo- cal needs, tradition, culture and general business environment. Australia did no adopt IFRS for SMEs and instead developed its own standard citing unsuit- ability of the IASB's standard for general purpose statement in Australia. The AASB noted that it would continue to monitor changes in IFRS for SMEs with possible future adoption if the