• Discussion at the December 2007 IASB Meeting
• Added to agenda December 2007
• IFRIC Interpretation 17 Distributions of Non-cash Assets to Owners was issued 27 November 2008
• Effective Date of IFRIC 17: Annual periods beginning on or after 1 July 2009. Earlier application is permitted, with some restrictions.

The Issue

Should Non-current Assets Held for Disposal and Discontinued Operations IFRS 5 be amended so that IFRS 5 would also cover non-current assets (or disposal groups) held for distribution to owners acting in their capacity as owners?

Discussion at the December 2007 IASB Meeting

The IFRIC staff presented a paper on whether the requirements in IFRS 5 are applicable to non-current assets (or disposal groups) classified as held for sale and to discontinued operations should be extended to non-current assets (disposal groups) that are held for distribution to owners. This issue arose as a consequence of IFRIC discussions on its project on accounting for non-cash distributions. Board members were commenting on an appendix to the board papers that was not available to the public.

One Board member raised the issue of whether the amendment should refer to the 'commitment' to distribute assets to its owners, or to an 'obligation' to distribute assets to its owners. It was noted that the use of the term 'commitment' would be consistent with the current wording of IFRS 5, whereas the term 'obligation' would be consistent with the wording of the draft Interpretation on non-cash asset distributions developed by the IFRIC.

The IFRIC staff said that they had not considered the issue as part of their deliberations on the draft IFRIC and suggested that the amendments to IFRS 5 be removed from the draft IFRIC Interpretation and considered by the Board as part of the 2008 Annual Improvements Process so as not to delay the publication of the Draft IFRIC Interpretation. The staff further suggested including a question in the draft IFRIC on this issue.

The Board agreed.