29 June 2003: Malaysia delays adoption of standard based on IAS 39
The Malaysian Accounting Standards Board has decided to delay, until at least third quarter 2004, the adoption of a standard on financial instruments that is based on IAS 39 because of the imminent changes to IAS 39. MASB also delayed a proposed standard on unit trusts for the same reason. Click for the MASB's News Release (PDF 15k).

28 June 2003: Proposed FASB staff position differs from IAS 37
The FASB staff has invited comment on a Draft FASB Staff Position (FSP) on accrual of a provision for a legislative requirement to remove asbestos that seems to reach a different conclusion from that in IAS 37 Example 6, "Legal Requirement to Fit Smoke Filters". The draft FSP concludes that a legal requirement to remove asbestos creates a liability even if the owner of the building with asbestos could sell it subject to the obligation. IAS 37 Example 6 concludes that a legal requirement to fit a smoke filter does not create a liability -- the liability is created only when the filter is actually installed but not yet paid for.

27 June 2003: New DTT guidance on accounting for income taxes
Deloitte Touche Tohmatsu has published a 120-page book of guidance on applying SSAP 12, Hong Kong's new standard on Accounting for Income Taxes (PDF 1,090k). Because SSAP 12 is substantially equivalent to IAS 12, we believe that this book will be of interest to all who apply IFRS. Chapters cover calculation of tax balances; current tax; deferred tax; tax bases; temporary differences; balance sheet recognition; measurement; recognition of the movement between the opening and closing balance sheets; and presentation and disclosure. There is also a chapter on applying the standard to Hong Kong circumstances including business combinations; investments; revaluations of properties; foreign currency translation; and compound financial instruments. Appendices include example tax worksheets; a presentation and disclosure checklist; illustrative disclosures; and an international comparison.

25 June 2003: Canadian Senate committee urges global accounting standards
After a year-long study triggered by Enron and other recent financial reporting scandals, a committee of the Senate of Canada has published a report that makes extensive recommendations on financial reporting, including: accounting and auditing standards, oversight of the profession, audit committees, certification of annual financial statements, MD&A, corporate governance, and management compensation. Two items relating to the work of the IASB are:

• The Committee's recommendation that "The federal government should take a leadership role and work with Canadian stakeholders in undertaking discussions with the US Financial Accounting Standards Board, the International Accounting Standards Board, and others that will result in all relevant parties working expeditiously toward the development of global uniform accounting standards."
• The Committee's view that "stock options are an element of compensation, and must be treated as an expense like any other compensation item."
  Click for Entire Report (PDF 333k).

24 June 2003: IASB has changed the dates of its July 2003 meeting
The new meeting dates are 22-24 July 2003 at the IASB's offices in London. The previously announced dates were 23-25 July. The agenda and running order have not yet been announced.

24 June 2003: "Convergence" on key share-based payment decisions
Both the IASB and the US FASB have projects on share-based payments. A Decision Summary (PDF 82k) prepared by the FASB for today's meeting of its Advisory Council summarises the two boards' decisions to date and concludes that "the IASB and the FASB are converged with respect to accounting for equity-settled employee stock-based compensation transactions.... The two Boards are converged in the sense that if the IASB's proposed guidance and the FASB's tentative decisions do not change, the final standards would be converged." The decision summary notes the following key decisions made to date:

24 June 2003: We have posted a new Accounting Roundup newsletter
You can download the 10-page 23 June 2003 Edition of Accounting Roundup from Deloitte & Touche (USA). Topics covered include the FASB ED on SPEs that qualify for off-balance-sheet treatment, summaries of decisions reached at recent FASB meetings, summaries of EITF consensuses (including one on software revenue recognition), new Derivatives Implementation Group FAS 133 guidance, recent SEC pronouncements, and a list of topics discussed at the IASB's May 2003 meeting. You can also download all 36 past editions of Accounting Roundup at the above link.

23 June 2003: EFRAG supports adoption of IFRS 1 in Europe
The European Financial Reporting Advisory Group has posted on its Website a draft of its proposed letter to the European Commission recommending that "it is in the European interest" for the Commission to adopt IFRS 1.

23 June 2003: Impediments to adopting IFRS in Australia
In its Media Release (PDF 58k) welcoming the adoption of IFRS 1, the Australian Accounting Standards Board has cited two significant impediments to adopting IFRS 1 and other IFRS in Australia. One is the fact that IFRS are copyrighted by IASB whereas Australian accounting standards must be freely available by law. Secondly, IFRS 1 makes cross-references to IFRS and amended IAS that have not yet been adopted by the AASB. Australian law prohibits cross-referring to regulations that have not yet been enacted. Rather than using IFRS in place of national GAAP, Australia is taking the approach of adopting an Australian equivalent of each individual IAS/IFRS.

22 June 2003: IFRIC July agenda is announced
The International Financial Reporting Interpretations Committee will meet on 1 and 2 July at the IASB's offices in London. The agenda includes the following topics:

• IAS 11 – The criteria for combining and segmenting construction contracts
• IAS 12 – Hyperinflation and deferred tax
• IAS 17 – Rights of use of assets
• IAS 19 – Multi-employer plan exemption
• IAS 19 – Money purchase plan with minimum guarantee
• IAS 19 – EITF issues update
• IAS 37 – Provisions: decommissioning and environmental rehabilitation funds
• IAS 37 – Changes in decommissioning and similar liabilities
• Update on activities of national interpretive bodies

20 June 2003: Detailed summary of IFRS 1 on first-time adoption
We have created a new page in our summaries of standards that reflects the History and Details of IFRS 1, First-time Adoption of International Financial Reporting Standards. We have also posted a four-page Summary of IFRS 1 (PDF 49k). See the IASB's Website to purchase IFRS 1.

19 June 2003: IASB issues IFRS 1 on first-time adoption

The International Accounting Standards Board has issued IFRS 1, First-time Adoption of International Financial Reporting Standards. IFRS 1 sets out the procedures that an entity must follow when it adopts IFRS for the first time as the basis for preparing its general purpose financial statements. IFRS 1 applies if an entity's first IFRS financial statements are for a period beginning on or after 1 January 2004. Earlier application is encouraged. A brief overview:

19 June 2003: FASB will converge with IASB on EPS calculations
At its 11 June 2003 meeting, the US Financial Accounting Standards Board agreed with the IASB decision to remove the issues of joint ventures, proportionate consolidation, and hyperinflationary economies from the scope of their convergence project. The FASB also added issues relating to earnings per share to the project scope and decided the following:

• For annual and year-to-date computation of diluted EPS, the dilutive effect of options and warrants should be reflected by applying the treasury stock method for the year-to-date period independently from any interim computation. Options and warrants will have a dilutive effect under the treasury stock method only when the average market price of the common stock for the year-to-date period exceeds the exercise price of the options and warrants. The IASB has adopted a similar year-to-date approach.
• When an entity has issued a contract that may be settled either in shares or in cash at the entity's option, the entity should presume that the contract will be settled in shares if the effect is dilutive. That presumption may not be overcome, regardless of past practice or stated policy to the contrary. While the IASB Improvements ED had proposed that the presumption be rebuttable, the IASB decided at its February 2003 meeting that the presumption may not be overcome.

19 June 2003: Notes from the third day of the IASB's June 2003 meeting
We have combined our notes from the three days of the IASB's June 2003 Board meeting in Rome, Italy into a Single Page.

18 June 2003: Notes from the second day of the IASB's June 2003 meeting
We have combined our notes from the three days of the IASB's June 2003 Board meeting in Rome, Italy into a Single Page.

17 June 2003: Cross-border accounting and auditing issues
US SEC Commissioner Roel C. Campos spoke in Brussels on Embracing International Business in the Post-Enron Era before the Centre for European Policy Studies on 11 June. He reviewed international accounting- and auditing-related matters such as principles-based standards, accommodations for foreign market participants in implementing the Sarbanes-Oxley Act, accommodations for foreign auditing firms by the Public Company Accounting Oversight Board, the convergence project of the IASB and the FASB, and acceptance of International Accounting Standards in the United States. Link to Full Text of Commissioner Campos's Remarks.

17 June 2003: Notes from the first day of the IASB's June 2003 meeting
We have combined our notes from the three days of the IASB's June 2003 Board meeting in Rome, Italy into a Single Page.

16 June 2003: Comparison of IFRS and Canadian GAAP updated
We have updated our Comparison of IFRS and Canadian Accounting Pronouncements to reflect all pronouncements issued as of 30 April 2003. The comparison is taken from Section 1501 of the Handbook of the Canadian Institute of Chartered Accountants and is presented with the CICA's permission (and our thanks). You will find links to comparisons of IFRS and other national GAAPs Here.

14 June 2003: SEC staff guidance non-GAAP financial measures
The SEC staff has responded to 33 questions on the disclosure of Non-GAAP Financial Measures (PDF 111k). Five of the Q&A are specifically intended for foreign private issuers, addressing issues such as income statement subtotals and earnings per share amounts that are expressly permitted or required by a foreign GAAP but that are not calculated consistently with those permitted or required by US GAAP. The Q&A are based on a Rule on Conditions for Use of Non-GAAP Financial Measures (PDF 304k) that the SEC adopted on 22 January 2003 pursuant to the Sarbanes-Oxley Act of 2002.

14 June 2003: IASB June 2003 meeting starts on Monday
The IASB will meet in Rome, Italy, on 16-18 June 2003. The Standards Advisory Council will meet at the same location on 19-20 June. Click here for Details and Preliminary Agendas for the meetings. We will post unofficial summaries of each day's discussions.

13 June 2003: UK survey shows need for more preparation for transition to IFRS
The Institute of Chartered Accountants in England and Wales has released results of a survey of its members (in both public practice and industry) to assess the level of awareness and preparation for the introduction of IFRS in 2005. Although the majority of members surveyed were aware of the move to IFRS, the survey showed that members generally were not aware of the extent of the impact that IFRS would have in the UK:

13 June 2003: Guidance on transition to Australian 'equivalents' of IFRS
The Australian Accounting Standards Board has agreed to issue an interpretation to explain the hierarchy of pronouncements in Australian GAAP. The AASB is planning to adopt Australian 'equivalents' of international standards that will be mandatory effective 1 January 2005. The AASB hopes to issue its revised standards by 31 March 2004. They have already exposed IAS 7, IAS 23, IAS 29, IAS 30 and IAS 41 for comment. Click for AASB Media Release (PDF 114k).

12 June 2003: FASB will converge with IASB on debt classification
The US Financial Accounting Standards Board has tentatively decided, as part of its short-term convergence project, to propose adoption of the positions in the IASB's Improvements Exposure Draft that: 

• Long-term debt due within 12 months of the balance sheet date should be classified as a current liability unless an agreement to refinance the liability on a long-term basis is completed on or before the balance sheet date.
• Long-term debt payable on demand at the balance sheet date because the entity breached a condition of its loan agreement should be classified as current unless the lender has agreed on or before the balance sheet date to provide a grace period for rectifying the breach during which the obligation is not callable and either (a) the entity rectifies the breach within the grace period or (b) at the time that the financial statements are issued, it is probable that the breach will be rectified within the grace period.

11 June 2003: FASB proposes to restrict derecognition on transfers to QSPEs
The US Financial Accounting Standards Board has issued an Exposure Draft proposing to restrict the circumstances in which a transferor could remove from its balance sheet financial assets that have been transferred to an off-balance sheet structure known as a qualifying special-purpose entity (QSPE). Under the FASB proposal, an entity would not be a QSPE (and therefore the transferor would not derecognise the transferred assets) if the transferor or its affiliates or agents is obligated to deliver additional cash or other assets to fulfill the SPE's obligations to beneficial interest holders (except certain servicing advances and forward contracts to transfer additional financial assets). The IASB is addressing derecognition of financial assets in its project to Amend IAS 39, although it is not considering a QSPE approach. Also, the IASB has on its agenda a project on Consolidation and Special Purpose Entities. The IASB has not yet established a timetable for that project.

10 June 2003: Toronto symposium on global financial reporting set for October
The Canadian Accounting Standards Board (ASB) will sponsor an International Summit on Financial Reporting in Toronto on 21 October 2003, the day before the start of the IASB's three-day Board meeting in that city. Speakers include the chairmen of the IASB, FASB, and the ASB. Click for More Information (PDF 133k).

9 June 2003: New Zealand will continue NZ-GAAP based on IFRS
Rather than replacing national GAAP with IFRS, as is being done for listed companies in Europe, the Financial Reporting Standards Board of New Zealand (FRSB) has begun a programme of adopting IFRS by converting them into NZ Financial Reporting Standards (FRS), with minor amendments generally in the form of additional requirements and guidance. For each international standard to be adopted in New Zealand, the FRSB will publish an exposure draft containing a summary of the main differences between the international standard and current NZ FRS together with a marked-up version of the international standard showing any modifications, additional requirements, and guidance proposed by the FRSB. It is likely that auditors' reports will refer to conformity with NZ Financial Reporting Standards. Click for More Information.

8 June 2003: Proposal to let foreign companies use IFRS in Canada
The Canadian Securities Administrators have invited comments on a proposal (NI 52-107 and 52-107CP), Acceptable Accounting Principles, Auditing Standards and Foreign Currency, that would allow foreign issuers and foreign registrants to use either IFRS or US GAAP without reconciliation to Canadian GAAP. Foreign companies would also be allowed to use their national GAAP if it covers "substantially the same core subject matter as Canadian GAAP", but with a reconciliation to Canadian GAAP. Canadian companies registered with the US SEC would also be permitted to use US GAAP. If an SEC issuer previously used Canadian GAAP and changes to US GAAP, it would be required to reconcile to Canadian GAAP for two years. In all cases, audits in accordance with either US GAAS or ISAs are required. Comments due 14 August 2003. Click to Download Proposal (PDF 167k).

6 June 2003: US Congressional committee holds stock option hearings
On 3 June 2003, the Committee on Financial Services of the US House of Representatives held a public hearing on The Accounting Treatment of Employee Stock Options. Among those testifying were Paul A. Volcker, Chairman of the IASC Foundation Trustees, and Robert H. Herz, Chairman of the US Financial Accounting Standards Board. You can download their (and other) testimony at the Committee's Website. You can also find their testimony on our Resources Page. The committee held the hearing in connection with proposed legislation that has been introduced in the House of Representatives (H.R.1372, the "Broad-Based Stock Option Plan Transparency Act of 2003") that would, in effect, impose a three-year moratorium on SEC recognition of "any new accounting standards related to the treatment of stock options".

6 June 2003: Terms of four IFRIC members extended to 30 June 2006
The Trustees of the IASC Foundation have renewed the terms of four members of IFRIC, including Ken Wild, a partner in Deloitte & Touche (United Kingdom) and our firm's IFRS Global Leader. The 12 IFRIC members serve staggered three-year terms. Click for IASCF Press Release (PDF 16k).

5 June 2003: IFRIC agenda projects section of IASPlus reorganised
We have revamped the section of this website that has information about agenda decisions and projects of the International Financial Reporting Interpretations Committee (IFRIC). Our previous meeting-by-meeting summary of IFRIC deliberations has been replaced by individual pages for each IFRIC agenda project. Within each page is a chronological summary of deliberations on that issue, both by IFRIC and, in some cases, by the IASB. We have created an overall Index Page for IFRIC Issues (with links to individual project summaries).

3 June 2003: We have published a new edition of IFRS in your Pocket

Deloitte Touche Tohmatsu has published the third edition of IFRS In Your Pocket (PDF 783k, May 2003). This popular 80-page guide includes: IASB structure and contact details IASC and IASB chronology Use of IFRS Around the World (including updates on Europe and the US) Summaries of each IASB Standard and Interpretation, annotated to indicate key proposals for change in current IASB projects Background and tentative decisions on all current IASB projects Other useful IASB-related information. You can download this and other Deloitte Touche Tohmatsu IFRS-related publications on our Publications Page. We are pleased to grant permission for accounting educators and students to print copies for educational purposes. Printed copies are available to accounting educators (while supplies last). Please email: info@iasplus.com.

2 June 2003: Final day of Deloitte & Touche IFRS conference in Copenhagen
Tomorrow (Tuesday, 3 June 2003) is the third and final day of the public conference hosted by Deloitte & Touche (Denmark) on the transition to reporting under IFRS. The topics of the day are:
 

• Presentation of IFRS financial statements (IAS 1, IAS 7, IAS 14, and IAS 35);
• Employee benefits, including pensions (IAS 19), intangible assets (IAS 38 and proposed changes to IAS 38), impairment of assets, including goodwill ((IAS 36 and proposed changes to IAS 36);
• Changes to internal reporting due to the transition to IFRS, including financial reporting, change management, and performance management.

2 June 2003: Which search terms do people use to find us?
IASPlus had 39,353 visitors from 117 countries during May 2003. 62% of them got here by typing our URL directly in their browser. The other 38% found us by searching via Google, Yahoo, MSN, etc. Here are the top 20 search terms they used:

2 June 2003: EFRAG seeks comments on its draft letter on IFRIC D1
Click here to Download EFRAG's Draft Comment Letter (PDF 28k) on IFRIC Draft Interpretation 1, Emission Rights. EFRAG needs comments by 27 June 2003 because it will finalise the letter at its July meeting.