At the October meeting of the European Financial Reporting Advisory Group (EFRAG), the European Commission explained that it has been decided that more extensive work on the costs and benefits of Standards and Interpretations needs to be carried out in future. The IASB has apparently agreed to carry out such work when developing proposals for new Standards and Interpretations, but that commitment will not cover projects already well-advanced and material issued but not yet endorsed. The European Commission is therefore as a result discussing with EFRAG the need for some form of cost-benefit study to be carried out as part of the endorsement process. Those discussions are ongoing but it is likely that EFRAG will be encouraged to extend the work it carries out in formulating its endorsement advice. This would be the case not only for Standards and Interpretations not yet issued, but also for those Standards and Interpretations on which EFRAG has not yet issued its final endorsement advice; in other words, IFRIC 13 Customer Loyalty Programmes, IFRIC 14 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction, and IAS 1 (Revised) Presentation of Financial Statements. It was noted that some further work would also need to be carried out, probably largely by the Commission, on the material on which EFRAG has already issued its endorsement advice: IFRIC 12 Service Concession Arrangements and IAS 23 (Revised) Borrowing Costs.

As a result, it was now unlikely that IFRICs 12-14, IAS 23 (Revised), and IAS 1 (Revised) will be endorsed before the end of 2007. EFRAG will continue to issue regular updates on the endorsement process on its website (www.efrag.org) in the form of Endorsement Status Reports [these are available on IAS Plus's EFRAG Page].

Click for October 2007 Edition of EFRAG Update.