| 20 June 2011: IASB formally announces public consultation proces on future agenda
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On 20 June 2011, the IASB has formally announced that it would be undertaking for the first time a public agenda consultation on its future work plan.
In February 2010 the Trustees of the IFRS Foundation, the IASB's oversight body, announced enhancements to their governance arrangements, including the decision to undertake a three-yearly public consultation on the IASB's future technical agenda, in addition to consulting the Trustees and the IFRS Advisory Council annually on the existing and future agenda.
A paper (link to IASB website) considered at the June 2011 IFRS Advisory Council Meeting outlines the expected timetable for the consultation process:
- July 2011: Discuss revised proposals with IFRS Foundation Trustees
- July 2011: Board discussion and finalisation of consultation proposals
- July 2011: Launch of Agenda Consultation, with a minimum 120 day comment period
- 30 November 2011: Consultation period ends
- Q1 2012: Publication of comment summary, start of Board discussions and consultation with the IFRS Advisory Council
- Q2 2012: Publication of Feedback Statement summarising what has been learnt from the agenda consultation
The paper outlines the primary focus of the consultation will be a 'Request for Views' document which will consider the agenda from two perspectives: (1) the overall strategic direction and balance of the agenda, and (2) understanding the financial reporting needs of stakeholders and how these might be balanced with constraining factors such as stakeholder and IASB resource capacity and the IASB's existing priorities.
Click for IASB announcement (link to the IASB website).
| Discussion at the June 2011 IASB Meeting
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Proposed timetable
The staff updated the Board on the agenda consultation process. The staff mentioned that a draft of the consultation document has been provided to the Advisory Council and that they would discuss the draft with the Trustees during their July meeting. The staff also intends to discuss with the Board during the July Board meetings prior to issuing the consultation document.
| Discussion at the July 2011 IASB Meeting
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The IASB is preparing to issue a consultation document on their future agenda. The Board received a draft of the report and was provided the opportunity to ask the staff any questions. The only question asked of the staff is whether it would be communicated that the current major projects would need to be completed prior to commencing with any other projects discussed in the agenda consultation document. The staff clarified that the current projects would not be included for discussion as part of the consultation request.
The Board unanimously agreed to the issuance of the agenda consultation request document.
| 26 July 2011: IASB launches a public consultation on its future work programme
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On 26 July 2011, the International Accounting Standards Board (IASB) launched a public consultation to seek broad public input on the strategic direction and overall balance of its future work programme.
The IASB has identified five key aspects that should be reflected in the strategic approach towards a future agenda:
- the IFRS community has become more diverse,
- the market environment has become more complex,
- there are a number of changes that require implementation,
- the quality and relevance of the standards needs to demonstrated,
- the risk that practices related to implementation and adoption will diverge.
Consequently, the IASB thinks that its future work
should fall into broad categories: 'Developing financial reporting' and
'Maintaining' existing IFRSs.
Below is an excerpt from the agenda consultation document concerning five strategic
areas driving the work of the IASB in those categories:
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Developing financial reporting
- Strengthening the consistency of IFRSs by completing the update of
the conceptual framework, and improving the usability of financial reports through the development of a presentation and disclosure framework.
- Investing in research and addressing the strategic issues for financial reporting to aid future standard-setting and to develop further the IASB's vision of the future shape of financial reporting, including exploring the interaction of IFRSs with integrated reporting.
- Filling gaps in the IFRS literature by undertaking standards-level projects, ie developing new IFRSs or making major amendments.
Maintaining existing IFRSs
- Obtaining a better understanding of operational issues of new IFRSs and major amendments through conducting post-implementation reviews.
- Improving the consistency and quality of the application of IFRSs by responding to implementation needs arising from the revised set of IFRSs, through the use of targeted, narrow-scope improvements to IFRSs, including consideration of the completeness and consistency of integration of XBRL with IFRSs.
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The IASB makes the agenda consultation document and several supporting documents available on its website (all links below to the IASB's website):
There will also be a live webcast on the IASB's agenda consultation on 3 August 2011.
Comments on the consultation document are required by 30 November 2011.
November 2011: Online investor survey on the
IASB's agenda consultation
As part of its outreach activities in connection with its
Request for Views Agenda Consultation 2011, the IASB has created an online survey to understand from the investor community which areas of accounting are in the most urgent need of improvement.
The survey asks for views on the relative importance and urgency of the various projects suggested as additions to the IASB's agenda
and, more generally, what works and doesn't work in financial statements.
The IASB believes that the survey should take no longer than 20 minutes to complete.
It is available until Monday 19 December 2011 via the
IASB website.
| Discussion at the January 2012 IASB Meeting
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Comment letter summary
The IASB staff presented feedback received in response to the Board's request for views Agenda Consultation 2011, as published for public comment in July 2011. Feedback was provided as an education session. No tentative decisions were taken by the Board.
In the conduct of this meeting, Board members provided very little feedback, but rather, limited their questions / comments to requesting clarification of information presented by the staff.
In summarising some of the key messages set forth by the staff, which was provided by way of 245 comment letter responses as well as investor-driven survey queries, the staff noted:
- Many respondents believed the Board should complete the four current projects (financial instruments, insurance contracts, leases and revenue recognition) as a priority.
- Many respondents believed the balance of efforts should be on maintaining IFRSs instead of developing IFRSs. This would include performing post-implementation reviews and providing implementation support processes, among other things.
- The conceptual framework was seen by many respondents as a priority, specifically in the areas of defining assets and liabilities, discussing other comprehensive income, discussing performance reporting and developing a disclosure framework. Investors, in particular, sought an agenda focused on minimising complexity in financial reporting which was discussed in the context of development of a disclosure framework.
- There were many requests for a 'period of calm'. This was seen as a way to assist jurisdictions that are first-time adopters of IFRSs by limiting changes, while also allowing other IFRS preparers time to evaluate and apply recently issued-standards. Feedback also suggested that a period of calm would allow the Board to focus its efforts on the four current projects and to make targeted improvements to existing IFRSs where necessary.
- Many respondents noted that the Board should devolve more of the maintenance of IFRS activities to the IFRS Interpretations Committee (IFRS IC) and the role of the IFRS IC should be redefined. Likewise, local standard-standards and regional groups were seen as resources to assist the IASB in research activities.
- While many respondents advocated a focus on framework projects (e.g., conceptual framework and presentation and disclosure framework), respondents did highlight certain standard-level projects of interest. The 6 projects that were most often cited by respondents as high priority included (1) other comprehensive income and performance reporting, (2) business combinations between entities under common control, (3) agriculture, particularly bearer biological assets (often jurisdictional specific response from Asian region), (4) rate-regulated activities (often jurisdictional specific response from Canada), (5) extractive activities and (6) emission trading schemes. However, many other project priorities were noted, including investor-specific priorities such as a discount rate project.
Acknowledging this feedback, the Board considered possible ways forward. Board suggestions included:
- Performing research. Many Board members requested that the staff perform limited research to scope the nature of prospective projects. Subsequent to identifying the scope of the issues, Board members requested that the staff consider cross-cutting issues to bifurcate projects (e.g., if the scope of Project A and Project B both relate to defining / identifying assets, these projects could be taken to the Board's agenda collectively).
- Searching for 'quick wins'. Many Board members were interested in identifying projects / issues which could be resolved quickly and were likely to yield little disagreement. These projects could potentially be added to the Board's agenda in the nearer term.
- Seeking input from the Advisory Council. The Board noted the need to present comment letter feedback to the Advisory Council to understand their reactions to the feedback received.
- Developing a proposal. Following the performance of the above, and considering any other offline feedback by Board members, Board members suggested that a proposal be brought before the Board for more thorough deliberations at a future meeting.
Board members generally expressed universal support for these suggestions.
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