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August

Deloitte Canada Countdown IFRS transition newsletter

29 Aug 2008

Deloitte Canada has published the August 2008 issue of their Countdown IFRS transition newsletter, to provide a snapshot of where we are now as far as Canada's transition to IFRSs is concerned – both in Canada and in Deloitte.

This edition of Countdown focuses on IFRS disclosure in Management Discussion and Analysis (MD&A) and the impact of the proposed definition of a Publicly Accountable Enterprise (PAE) on the following sectors:
  • Profit-oriented non-publicly accountable enterprises (private enterprises)
  • Not-for-profit organisations (NPOs)
  • Pension plans
As always, there is also an update on current IFRS events. Click below for:

 

Heads Up discusses 'roadmap' to IFRSs in the USA

29 Aug 2008

The 28 August 2008 issue of Heads Up titled On the Road to IFRSs discusses the SEC's recent decision to issue a proposed roadmap to IFRS adoption in the United States.

The roadmap proposes to:
  • give certain US issuers the option to use IFRSs in their financial statements filed on Form 10-K for financial years ending on or after 15 December 2009, and
  • establish seven milestones that, if achieved, could lead to an SEC decision for mandatory use of IFRSs starting for financial years ending on or after 15 December 2014.

Click to view On the Road to IFRSs (PDF 190k).

 

IASC Foundation publishes new IFRS taxonomy guide

29 Aug 2008

The International Accounting Standards Committee (IASC) Foundation has published IFRS Taxonomy Guide 1.00 – All you need to know about the IFRS Taxonomy as a preparer, supervisor, software developer.

It can be downloaded from the IASCF Website.

 

AICPA statement of support for the SEC's 'roadmap' to IFRSs

29 Aug 2008

The American Institute of CPAs has issued a Statement Supporting the SEC Roadmap.

The roadmap "marks an important stage in what the American Institute of Certified Public Accountants believes will be the eventual move from US Generally Accepted Accounting Principles to international accounting standards for public companies."
Click to view Statement Supporting the SEC Roadmap (PDF 41k).

 

SEC proposes a 'roadmap' to IFRSs for domestic US registrants

28 Aug 2008

On 27 August 2008, the US Securities and Exchange Commission voted to publish for public comment a proposed 'roadmap' that could lead to the use of International Financial Reporting Standards (IFRSs) by US issuers beginning in 2014. Currently, US issuers must use US GAAP, though foreign registrants (of which there are around 1,100 from 52 jurisdictions) may elect to use IFRSs.

The proposal suggests mandatory adoption by US registrants could be phased in from 2014 to 2016 depending on company size:
  • Large accelerated filers in 2014
  • Accelerated filers in 2015
  • Non-accelerated filers in 2016.
The proposal also would permit voluntary early adoption for a limited group of large US registrants (based on industry and size, roughly 110 companies eligible) for periods ending after 15 December 2009 (filings in 2010). However, mandatory IFRS adoption starting in 2014 would not be automatic. In 2011, the Commission would evaluate the progress of IFRSs against certain defined milestones and make a decision on whether to go ahead with adoption starting in 2014, later, or not at all. Here is the SEC Press Release (PDF 30k). The SEC has not yet posted the full text of the proposal on its website. There will be a 60-day comment period that begins when the roadmap proposal is published in the Federal Register. Financial Executives International has issued a Press Release (PDF 37k) stating that "FEI supports the SEC's decision today to propose a Roadmap for US issuers for filings of financial statements prepared in accordance with IFRS." [This story has been expanded from our original posting.]

 

SEC votes to update disclosure rules for foreign companies

28 Aug 2008

On 27 August 2008, the US Securities and Exchange Commission voted unanimously to update and modernise the disclosure requirements for foreign companies offering securities in US markets.

Currently, there are around 1,100 foreign SEC registrants and another 700 foreign companies whose equity securities trade over-the-counter in the US without SEC registration. Click for the SEC Press Release (PDF 34k). Three sets of amendments were approved:

Foreign issuer reporting enhancements. These will shorten the deadline for annual reports filed by foreign private issuers from six months to four months. The rule amendments also enable foreign issuers to test their eligibility to use the special forms and rules available to foreign private issuers once a year, rather than continuously; enhance the disclosures a foreign private issuer provides to investors regarding any changes in and disagreements with its auditor; and revise the annual report and registration statement forms used by foreign private issuers to improve certain disclosures provided in these forms.

Exemption from registration. Exchange Act Rule 12g3 exempts a foreign private issuer from registering equity securities if it submits to the SEC of certain information published outside the US. The exempted securities can then trade in the US over-the-counter (OTC) market without registration. Currently, there are around 700 Such Companies (PDF 399k). The adopted rule amendments will eliminate the current written application and paper submission requirements by automatically exempting a foreign private issuer from Section 12(g) provided it meets specified conditions. As is currently the case, issuers must continue registering their securities under the Exchange Act to have them listed on a national securities exchange or traded on the OTC Bulletin Board.

Cross-border business combinations and rights offerings. The Commission approved amendments to expand and enhance the utility of the exemptions for business combination transactions, tender offers, and rights offerings and to encourage offerors and issuers to permit US security holders to participate in these transactions on the same terms as other security holders. The Commission also voted to provide interpretive guidance on several topics that come up frequently for practitioners in the cross-border area.

 

More about the SEC 'roadmap' toward IFRSs

28 Aug 2008

In a speech at the open meeting of the SEC at which the SEC agreed to propose a roadmap toward use of IFRSs by domestic SEC registrants, SEC Commissioner Elisse B Walter elaborated on several aspects of the yet-to-be-released proposal.

One is that an entity that chooses voluntary early adoption will be required to include, in its financial statements, a reconciliation from IFRS figures to US GAAP. That is because of the possibility that the Commission may ultimately decide not to require or allow US issuers to use IFRSs, or may delay the starting date. Click for Commissioner Walter's Remarks (PDF 78k). Here is an excerpt:

Most important, we have to keep in mind that no one knows for certain what the future will hold. I strongly believe that we have to prepare for the alternative that the Commission will determine not to adopt, or permit the use of, IFRS for US issuers. As the milestones presented in the Roadmap show, there are significant hurdles to overcome over the next three years in order for the Commission to determine to accept IFRS reporting from US issuers. Therefore, I strongly support the reconciliation proposal, otherwise known as Alternative Proposal B for early adoption. Under Alternative Proposal B, reconciliation would continue until further Commission action on the use of IFRS by US issuers. I believe that this reconciliation Proposal is extremely important – in order to increase comparability and help US investors transition to seeing US companies present their financials in IFRS. It is also critical to me because it gives early adopters of IFRS a way back to US GAAP if the Commission determines not to adopt the use of IFRS in 2011.

 

Deloitte will sponsor IFRS 2008/09 conference

27 Aug 2008

Deloitte will be the main sponsor of IFRS 2008/9 Strategic Direction and Practical Interpretation, a conference that will be held in London on Wednesday 12 November 2008. Speakers at this annual conference include IASB Chairman Sir David Tweedie (opening keynote address and open dialogue) and Deloitte partners Ken Wild and Veronica Poole.

Topics that will be covered include an analyst's view of financial reporting priorities; FSF recommendations on risk disclosures, valuations, and off balance sheet vehicles; the professional practice view of IFRSs; valuations in light of the credit crunch; the year ahead for IFRSs; implications of IFRSs for directors and auditors; complexity of standards; and IFRSs and regulation.

 

Technology implications of IFRS adoption for US companies

27 Aug 2008

Deloitte Consulting LLP (United States) has published a booklet that explores the technology implications associated with IFRS conversion by US companies.

It discusses:
  • Evaluating the potential technology impact
  • How companies can prepare technology and systems changes related to IFRS adoption
  • Major differences between US Generally Accepted Accounting Principles (GAAP) and IFRS differences and what it means for systems
  • Key IFRS discoveries from some companies around the globe
Click to download Technology Implications of IFRS Adoption for US Companies (PDF 276k). You will find Links to Many Other IFRS Publications here.

 

JSE requires auditors to have 800 hours IFRS training

26 Aug 2008

The Johannesburg Stock Exchange has amended its listing requirements to require all independent auditors of listed companies to have experienced IFRS specialists and to register with the JSE.

Specifically, the new JSE rules:
  • establish a JSE Registry for Auditors and their IFRS advisors
  • require any audit firm that wishes to audit listed companies to be registered with the JSE
  • require all audit firms to have at least three individual auditors within the firm registered with the JSE
  • require all audit firms to have at least one IFRS advisor, either internal or external to the firm, registered with the JSE. The role of the IFRS advisor includes providing 'technical IFRS assistance and advice in support of the assurance opinion'.
  • require IFRS advisors to have spent a specified number of hours on 'performing practical and interpretive IFRS consulting over the past 12 months in order to have a comprehensive working knowledge of IFRS'.
    • If the IFRS advisor is a single individual, 800 hours of IFRS experience in the past 12 months is required.
    • If the IFRS advisor is one of two individuals who work as part of an IFRS advisory group, each of those individuals must have spent at least 500 hours on IFRS work in the past year.
The JSE requires listed companies to follow IFRSs and requires auditors to follow International Standards on Auditing. Click for JSE Listing Requirements that Contain the New Rules (PDF 169k). Here is a link to our South Africa Page.

 

Correction list for hyphenation

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