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Annual improvements – Assessment of the annual improvements criteria

Date recorded:

Amendments to Due Process Handbook

The staff raised a number of issues with the Board related to the IFRS Foundation's proposals for amendments to the IASB's Due Process Handbook. The staff discussed the feedback received through comment letters on the Consultation Document with the IFRS Interpretations Committee during their January 2011 meeting.

During this meeting the staff brought various proposed changes to the Due Process Handbook, and when the staff's view differed from that of the Committee, the staff brought both proposals to the Board for consideration.

The comments primarily focused on the guidance in paragraph 65 of the proposal related to the criteria necessary to be met in order to qualify for inclusion in annual improvements. While considering the comments received, the Board has tentatively agreed on the following:

  • to eliminate language that suggested annual improvements could create an exception from an existing IFRS principal
  • to change the proposed wording from "there must be a pressing need to make the amendment" and instead provide language that the IASB will consider if annual improvements are the appropriate process or whether amending through another project would be a "quicker or more efficient" method
  • to retain the language in paragraph 65(a)(ii); one respondent had requested clarification of "resolving a conflict" and "addressing an oversight" as they felt this could be beyond the scope of the annual improvements process
  • to not provide further clarification on the language in paragraph 65B related to the Board's assessment of annual improvements against the criteria before the exposure for public comment,
  • to amend the proposed language in paragraph 65A(b) on the proposed amendment being narrowly focused to now read "the proposed amendment is well-defined and sufficiently narrow in scope such that the consequences of the proposed change have been considered"
  • to retain the language in paragraph 65A(c) on the inability to reach a timely conclusion may be indicative of an issue that cannot be addressed through the annual improvements process.

The Board also tentatively agreed to provide further distinction between an annual improvement and an interpretation by providing more detailed language around the objectives of the annual improvements process. The Board also tentatively agreed to provide a single set of qualifying criteria for assessing an issue for inclusion as an annual improvement or as interpretive guidance.

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