Susan Maina is a content writer at Mugo and Company, where she simplifies Accounting, Auditing, and Forensic Audit services with her finance expertise.
LinkedIn >>Table of Contents
If you run a subsidiary company in Kenya — maybe part of a larger group — you already know how much work goes into preparing financial statements.
Sounds familiar?
Here’s the good news — IFRS 19 in Kenya was created to make this whole process simpler.
This new standard, issued by the International Accounting Standards Board (IASB) in May 2024, helps subsidiaries that don’t have public accountability prepare simpler, shorter financial statements while still following all the important IFRS accounting rules.
In this guide by Mugo & Company, we’ll walk you through what IFRS 19 in Kenya really means — and whether your business is eligible.
Still unsure what IFRS 19 means for your Kenyan business?
Request your FREE IFRS Consultation with Mugo & Co todayBefore we go deeper, let’s quickly go over a few important terms you’ll see throughout this article:
| Terms | What It Means (Simple English) |
|---|---|
|
Subsidiary |
– A company that is controlled by another company (the parent). – The parent usually owns more than 50% of its shares. |
|
Parent Company
|
– The main company that owns and controls one or more subsidiaries. – It prepares consolidated financial statements for the whole group. |
|
Public Accountability |
– When a company’s financial statements are used by the public — for example, banks, insurance companies, or listed entities that hold people’s money. – Such companies must follow full IFRS. |
|
Subsidiary without Public Accountability |
– A private company owned by a parent company that doesn’t raise money from the public and doesn’t hold public deposits. – These are the main beneficiaries of IFRS 19. |
|
Consolidated Financial Statements |
– Reports that combine the financial information of the parent and all its subsidiaries, showing the group as one entity.
|
|
IFRS 19 – Subsidiaries Without Public Accountability (Disclosures)
|
– A new standard that lets subsidiaries use simplified disclosure requirements while still following the recognition and measurement rules of full IFRS.
|
|
Disclosure |
– Notes and explanations that accompany financial statements — they tell the “story behind the numbers.”
|
Think of IFRS 19 in Kenya as a “lighter” version of all the other IFRS — made especially for subsidiaries.
Imagine you run a subsidiary company in Nairobi — maybe part of a larger regional group.
Every quarter, your finance team prepares financial statements, but your parent company, KRA, and ICPAK all have different expectations.
You might be asking yourself:
IFRS 19 – Subsidiaries Without Public Accountability (Disclosures) was created to solve this.
It lets you use the same accounting rules your parent company uses (for example, how you measure income, expenses, or assets), but it reduces the long list of disclosures you must include in your financial statements.
In short,
IFRS 19 in Kenya helps you prepare clean, focused financial reports — without all the extra pages and notes that few people actually read.
So instead of preparing 100-page reports, you highlight only what’s useful and relevant for your parent company, regulators, and other local stakeholders.
Let Mugo & Company walk you through IFRS 19 in Kenya — step-by-step, in plain language you’ll actually understand.
Request your FREE IFRS Consultation with Mugo & Co todayIFRS 19: Subsidiaries Without Public Accountability – Disclosures was officially released in May 2024.
This was after years of consultation with accountants, auditors, and regulators — including voices from ICPAK who pushed for simpler rules for smaller subsidiaries.
IFRS 19 in Kenya becomes effective for financial years starting on or after 1 January 2027.
But here’s the good news: if your subsidiary is ready, and your auditors give the green light, you can start using it earlier.
In simple terms, you don’t have to wait until 2027 to simplify your reports — you can adopt IFRS 19 sooner and start saving time, effort, and costs right away.
Our team will help you determine exactly when and how IFRS 19 applies to your organisation.
Request your FREE IFRS Consultation with Mugo & Co todayLet’s keep it simple: IFRS 19 is all about making financial reporting easier, faster, and more relevant, without messing with the accuracy of your numbers.
| Objective | What it Means For You |
|---|---|
|
Simplify Financial Reporting
|
– Instead of dozens of lengthy disclosure notes, you include only what really matters — so your statements are cleaner and easier to read.
|
|
Align with your parent company’s reporting
|
– No more juggling different accounting rules. IFRS 19 lets you follow the same policies your parent company uses, keeping everyone on the same page.
|
|
Save time and money
|
– Shorter reports mean less time spent preparing, reviewing, and auditing. That’s fewer headaches and lower costs.
|
|
Make financial reports more relevant |
– Focus only on the information that your local stakeholders — and your parent company — actually need. No fluff, no unnecessary details.
|
This might sound like fancy accounting jargon, but it’s actually simple.
A company has public accountability if:
If your business doesn’t do either, it means you don’t have public accountability — and that’s exactly the type of company IFRS 19 in Kenya was designed for.
Not every company can use IFRS 19 — it’s specifically for certain subsidiaries.
To qualify, your business must:
If that sounds like your situation — great! You can apply IFRS 19 in Kenya and start enjoying simpler, cleaner financial reporting.
We’ll assess your setup — subsidiaries, associates, group entities — and guide you on the correct reporting approach.
Request your FREE IFRS Consultation with Mugo & Co todayLet’s make this simple. Here are some real-world examples to help you see who qualifies for IFRS 19 in Kenya:
| Subsidiary Type | Example | IFRS 19 Applicable? |
|---|---|---|
|
Local branch of a multinational |
– Toyota Kenya reporting to Toyota Global
|
Yes |
|
Family-owned Kenya SME
|
– Not part of any IFRS-reporting group
|
No |
|
Subsidiary of a listed Kenyan group |
– A real estate unit under Centum Investments
|
Yes |
|
Local distributor owned by a South African parent
|
– FMCG company reporting to JSE-listed parent
|
Yes |
In short: if your company is part of a larger group and doesn’t deal with the public, IFRS 19 in Kenya can simplify your reporting.
IFRS 19 in Kenya isn’t meant to replace all IFRS standards.
Think of it as a “lighter disclosure framework” for subsidiaries. You still follow all the regular IFRS rules for recognizing and measuring assets, liabilities, income, and expenses.
The big change is that you don’t have to include all the lengthy disclosure notes that full IFRS normally requires.
For subsidiaries adopting financial reporting for the first time, IFRS 19 can actually make things easier. Here’s why:
1. You start on the right foot:
Instead of learning and implementing full IFRS with every disclosure requirement, you can focus on the essential financial reporting rules and only the simplified disclosures.
2. Alignment with parent company:
Even if you’re new to reporting, IFRS 19 allows you to follow the same accounting policies as your parent, which reduces confusion and duplication.
3. Less overwhelming:
Preparing 100-page financial statements can be daunting. IFRS 19 gives first-time reporters a clear, structured, and manageable framework.
4. Optional early adoption:
You can start using IFRS 19 as soon as your auditors and parent company agree, so you don’t have to wait until 2027.
In short, IFRS 19 in Kenya works alongside existing IFRS standards and is friendly for newcomers.
It lets first-time reporting subsidiaries produce reliable, compliant, and simpler financial statements — without getting lost in the details.
Think of IFRS 19 in Kenya as keeping all the important rules but removing the extra clutter. Here’s what it does:
Example:
The result: a cleaner, easier-to-read set of financial statements that still fully complies with IFRS.
Mugo & Co. can help you interpret and apply IFRS 19 confidently in your business
Request your FREE IFRS Consultation with Mugo & Co todayIFRS 19 in Kenya isn’t just about following rules — it actually makes your life easier. Here’s how:
| Benefit | What it Means for You |
|---|---|
|
Less paperwork
|
– You’ll prepare 60–70% fewer disclosure notes, so your financial statements are much shorter and simpler.
|
|
Lower costs
|
– Less work means you save on audit and reporting expenses.
|
|
Faster reporting |
– Closing your books and sending reports to your parent company becomes quicker and smoother.
|
|
No double work |
– You don’t need separate IFRS and local GAAP records, everything is aligned.
|
|
More consistency |
– Your financial statements will match your parent company’s policies, making consolidation and reporting easier.
|
IFRS 19 in Kenya makes reporting simpler and more efficient. Here’s a quick comparison:
| Area | Before (Old Way) | Now (With IFRS 19) |
|---|---|---|
|
Disclosure Volume
|
– You had dozens of detailed notes under every IFRS standard — overwhelming, right?
|
– Now, you only include the essential disclosures that actually matter.
|
|
Accounting policies
|
– Sometimes your numbers didn’t fully match your parent company’s policies.
|
– Everything is aligned with your parent’s IFRS policies, so no more confusion.
|
|
Reporting systems
|
– Two sets of accounting records (local + group) — double the work.
|
– Just one IFRS-based record for both local and group reporting
|
|
Audit Effort |
– Auditors had to wade through lots of unnecessary details.
|
– The audit is now streamlined, focusing only on what really matters.
|
In short, IFRS 19 helps you cut the clutter, save time, and stay fully compliant — without all the headaches of extra paperwork.
As of now, ICPAK and the Financial Reporting Centre (FRC) are reviewing IFRS 19 for local endorsement — expected before 2027.
However, some Kenyan subsidiaries are already preparing by:
At Mugo & Company, we’re helping subsidiaries get a head start.
We assess whether your business qualifies, align your accounting policies with IFRS 19, and plan a smooth transition so you’re ready when the standard is officially adopted.
1. What is IFRS 19 in Kenya in simple terms?
2. Is IFRS 19 mandatory?
3. When will IFRS 19 in Kenya start applying?
4. How is IFRS 19 in Kenya different from IFRS for SMEs?
5. What’s the difference between IFRS 18 and IFRS 19 in Kenya?
6. Who can use IFRS 19 in Kenya?
If you run a subsidiary in Kenya, IFRS 19 in Kenya is a real game-changer.
It keeps your financial statements fully IFRS-compliant but cuts out all the extra, often confusing details that don’t add value.
That means less time buried in paperwork, fewer headaches with auditors, and lower costs overall.
If your parent company already reports under IFRS, adopting IFRS 19 in Kenya makes your reporting faster, cleaner, and easier to understand — for both your team and anyone reviewing your accounts.
At Mugo & Company, we guide subsidiaries every step of the way. From checking if you qualify, to preparing simplified disclosure checklists, to training your finance team, we help make the transition to IFRS 19 smooth and stress-free.
Ready to simplify your financial reporting?
Book a free IFRS consultation with our experts today.
Partner with us for smooth IFRS 19 adoption and clear, professional presentation of your financial statements.
Request your FREE IFRS Consultation with Mugo & Co todayThis guide is for general information only and should not replace professional advice. Always consult your auditor or accountant for guidance tailored to your specific business situation.
IFRS 18 changes financial performance reporting | EY – Global
IFRS 19 Subsidiaries without Public Accountability: Disclosures
IFRS 19 – Reducing subsidiaries’ disclosures | KPMG UK
IFRS 19 – reduced disclosures in financial statements | EY – MENA.
IFRS 18 in Kenya — Presentation of Financial Statements Guide | Mugo & Company.
Industry Leaders Delivering Client-Focused Solutions with Proven Expertise and Excellence.
Woodland Business Park, 4th Floor, Suite 15, Kiambere Road, Upperhill, Nairobi
info@mugo-co.com
+254 736 570 370
Copyright © 2025 Mugo & Company | All Rights Reserved.
Mugo & Company – Experts in assurance services in Kenya since 1984.
