What Is TFRS? A Quick Summary

TFRS stands for Thai Financial Reporting Standards — the official set of accounting standards used in Thailand for preparing and presenting financial statements. They are issued and maintained by the Federation of Accounting Professions (TFAC), the regulatory body overseeing accounting practices in the country.

TFRS is based on International Financial Reporting Standards (IFRS), the global framework developed by the IFRS Foundation. Thailand adopted IFRS-aligned standards to ensure that Thai financial statements are comparable with those from other countries, which is critical for international trade, investment, and regulatory compliance.

In practice, TFRS is mandatory for all entities that prepare financial statements in Thailand — whether publicly listed companies, government agencies, state enterprises, or private businesses. The specific requirements may vary depending on whether an entity is publicly accountable, but the underlying framework applies broadly.

For accountants, TFRS governs everything from how you structure your chart of accounts to how you recognize revenue, measure financial instruments, and present disclosures in your notes to financial statements.

Why TFRS Changes So Frequently

If it feels like accounting standards change every year, that is because they do. Here is why:

• IFRS updates globally each year. The International Accounting Standards Board (IASB) continually issues amendments, interpretations, and new standards. As Thailand aligns TFRS with IFRS, domestic standards must follow suit.
• TFAC aligns TFRS with IFRS for international acceptance. Thailand's goal is to maintain equivalence with international standards, so when IFRS changes, TFRS changes accordingly — sometimes with a one-to-two year lag.
• Business transactions are increasingly complex. Leases, financial instruments, digital assets, revenue from multi-element contracts — the economic landscape evolves faster than standards can anticipate. New guidance is needed regularly.
• Changes affect everything. A single standard revision can cascade through your chart of accounts, journal entry templates, financial statement formats, and disclosure notes. What looks like a "minor amendment" on paper can mean weeks of system reconfiguration.

Key TFRS Standards Every Accountant Must Know

Before diving into the 2026 changes, here is a reference table of the most impactful TFRS standards that accountants deal with regularly:

Standard	Topic	Key Impact
TFRS 9	Financial Instruments	Classification of financial assets into amortized cost, fair value through OCI, or fair value through profit/loss; Expected Credit Loss (ECL) model for impairment
TFRS 15	Revenue from Contracts with Customers	5-Step Model for revenue recognition — identify contract, identify performance obligations, determine transaction price, allocate price, recognize revenue
TFRS 16	Leases	Right-of-Use (ROU) Asset and Lease Liability recognized on the balance sheet for virtually all leases
TAS 12	Income Taxes	Deferred Tax Asset and Deferred Tax Liability calculations based on temporary differences
TAS 36	Impairment of Assets	Impairment testing required when indicators exist; recoverable amount must be assessed

These standards form the backbone of modern Thai financial reporting. Understanding them is not optional — it is a professional requirement.

3 Key Changes Taking Effect in 2026

Now let us look at the specific changes that accountants must address this year.

1. TFRS 16 Lease Amendments — Sale-and-Leaseback Transactions

TFRS 16 already required most leases to be recognized on the balance sheet. The 2026 amendments introduce specific guidance for Sale-and-Leaseback transactions — situations where an entity sells an asset and immediately leases it back from the buyer.

Previously: All leases were recognized on the balance sheet under TFRS 16, but the treatment of gains or losses from sale-and-leaseback arrangements was not always clear.

New guidance: The amendments clarify how a seller-lessee should measure the lease liability arising from a sale-and-leaseback transaction, particularly regarding variable lease payments. The goal is to prevent a seller-lessee from recognizing a gain or loss that relates to the right of use it retains.

Impact: Organizations that have entered into sale-and-leaseback agreements must review all existing leaseback contracts and reassess whether the accounting treatment applied in prior periods remains appropriate under the amended standard. This may require retrospective adjustments.

2. Liability Classification Under TAS 1 — Current vs Non-Current

TAS 1 (Presentation of Financial Statements) has been amended to revise the criteria for classifying liabilities as current or non-current.

The key change: classification should be based on the rights that exist at the end of the reporting period, not expectations about whether the entity will exercise those rights. For example, if an entity has the right to defer settlement of a liability for at least twelve months after the reporting period, the liability should be classified as non-current — even if management expects to settle it sooner.

Impact: Organizations may need to reclassify liabilities on their balance sheet. A liability previously classified as current might become non-current (or vice versa) under the revised criteria. This affects key financial ratios such as the current ratio and working capital, which are commonly used by lenders, investors, and regulators. For more on period-end challenges, see our article on late financial closing problems.

3. TFRS for NPAEs — Simplified Standards for SMEs

TFRS for Non-Publicly Accountable Entities (NPAEs) provides a simplified financial reporting framework for smaller entities that do not have public accountability. The 2026 revisions update several areas to reduce the reporting burden on SMEs while maintaining adequate financial transparency.

Key simplifications include:

• Reduced disclosure requirements for financial instruments
• Simplified revenue recognition guidance
• Relaxed requirements for certain measurement bases
• Clearer guidance on distinguishing between NPAEs and entities that should apply full TFRS

Impact: Small and medium enterprises that qualify as NPAEs may find reduced compliance costs and simpler financial statement preparation. However, entities must carefully assess whether they genuinely qualify as NPAEs, as misclassification could lead to regulatory issues.

What Accountants Must Do Now — 5 Action Items

Knowing what changed is only half the battle. Here is what you need to do about it:

1. Review Your Chart of Accounts

New standards often require new account codes. For example, TFRS 16 amendments may necessitate separate accounts for sale-and-leaseback Right-of-Use Assets, and TAS 1 changes may require reclassification entries that need distinct account codes. Review your chart of accounts structure and add any missing codes before the first reporting deadline.

2. Update Financial Statement Formats

TAS 1 amendments directly affect how liabilities are presented on the balance sheet. Ensure your financial statement templates reflect the revised classification criteria. This includes updating the statement of financial position, notes to financial statements, and any management reports that rely on current/non-current distinctions.

3. Review All Lease Contracts

If your organization has any sale-and-leaseback arrangements, the TFRS 16 amendments require a thorough review. Identify all affected contracts, recalculate lease liabilities where necessary, and assess whether any retrospective adjustments are required. Even organizations without leaseback arrangements should verify that their existing TFRS 16 calculations remain correct under the amended guidance.

4. Update Accounting Policies and Disclosures

Every change in accounting standards must be reflected in your accounting policy disclosures. The notes to your financial statements must clearly state which new or amended standards have been adopted, the date of adoption, and the impact on your financial position and results. Failure to disclose standard changes is a common audit finding.

5. Train Your Accounting Team

Standards are only as effective as the people applying them. Ensure your accounting team understands the 2026 changes — not just at a theoretical level, but in terms of practical application within your specific organization. This includes understanding how changes affect daily journal entries, month-end procedures, and year-end closing processes. For more on building a well-rounded accounting team, see our article on what shapes the accounting personality.

Accounting standards change every year, but if your system is flexible enough, change is not a crisis — it is just an update.

- Saeree ERP Team

How ERP Systems Help Organizations Adapt to New TFRS

When accounting standards change, organizations face two choices: manually reconfigure every spreadsheet, template, and process — or let a properly designed ERP system handle the heavy lifting.

Here is how ERP addresses each aspect of TFRS compliance:

• Flexible Chart of Accounts — A well-designed ERP system lets authorized users add, modify, or restructure account codes without requiring developer intervention. When new TFRS standards introduce new asset types or reclassification requirements, the chart of accounts can be updated immediately. See our guide on ERP accounting modules.
• Configurable Financial Reports — Financial statement formats can be designed and modified to match new presentation requirements. When TAS 1 changes how liabilities are classified, the report templates can be adjusted without rebuilding from scratch.
• Automated Calculations — Complex calculations such as Right-of-Use Assets, Lease Liabilities, Deferred Tax Assets, and Expected Credit Losses can be automated based on the parameters defined in the standard. This eliminates manual calculation errors and ensures consistency across reporting periods.
• Complete Audit Trail — Every change to accounting data is logged: who changed it, when they changed it, what the previous value was, and what the new value is. When auditors ask how you implemented the new TFRS requirements, you have a complete record.
• Multi-Standard Support — Organizations that need to prepare financial statements under both full TFRS and TFRS for NPAEs (for example, a parent company and its smaller subsidiaries) can manage both frameworks within a single system. For budget-related considerations, see our article on budget vs accounting reconciliation.

Summary

TFRS changes are not optional and they are not going away. Every year brings new amendments, and 2026 is no exception. The three major changes — TFRS 16 lease amendments, TAS 1 liability classification revisions, and updated TFRS for NPAEs — each require concrete action from accounting teams.

The organizations that handle these transitions smoothly are the ones with flexible systems, trained teams, and clear processes. The ones that struggle are typically those still relying on rigid spreadsheets and manual workarounds.

If your organization needs help evaluating how these TFRS changes affect your accounting processes, or if you want to see how an ERP system can simplify compliance, contact the Saeree ERP team for a free consultation.

References

1. Federation of Accounting Professions (TFAC). "Thai Financial Reporting Standards." https://www.tfac.or.th
2. IFRS Foundation. "International Financial Reporting Standards." https://www.ifrs.org