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June

SEC Commissioner backs IFRS adoption, discusses possible 'opt out' for issuers

30 Jun 2011

United States Securities Exchange Commission (SEC) Commissioner Kathleen L. Casey has supported the adoption of IFRS in the United States in a recent speech.

Giving the keynote address at the Society of Corporate Secretaries and Governance Professionals 65th Annual Conference in Colorado, United States on 29 June 2011, Ms Casey highlighted the benefits of IFRS adoption. Topics covered included the benefits of a single set of high-quality global accounting standards in increasingly global capital markets, the impacts of more United States entities investing in entities that report in accordance with IFRSs, the United States' influence on IFRS development and cost and other concerns raised by constituents.

Ms Casey also discussed the possibility of an 'opt out' for issuers, perhaps on a permanent basis. An extract follows:

While I believe that the United States must provide for reporting under IFRS by U.S. issuers, I believe that we can and should give some issuers the option to continue to report under U.S. GAAP.

One of the concerns that has been expressed since we first issued the "Road Map" in November 2008, from smaller reporting companies and other companies that have no international operations or aspirations, is that the transition to IFRS will be burdensome and impose costs without providing them with any commensurate benefits. I understand these concerns, and it makes sense, in my view, to allow these issuers to opt out of IFRS, at least initially, if not permanently. Providing optionality would preserve the benefits of IFRS, ensure continued U.S. influence in the development and preservation of IFRS, and avoid unnecessary costs for smaller U.S. issuers.

Some commentators object to providing optionality on the basis that it would lead to a "two-GAAP" world. My response is that we are already in a two-GAAP world. The Commission already permits foreign private issuers to report using IFRS. Furthermore, in light of the global nature of our capital markets, investors, public accountants and other market participants already need to know both U.S. GAAP and IFRS.

Click for full text of the speech (link to the SEC website).

Model financial statements for Australian 'Reduced Disclosure Requirements' for June 2011

29 Jun 2011

The Australian Securities & Investments Commission (ASIC) has called for companies to provide more clarity on the remuneration arrangements for their directors and executives.

Under the Australian Corporations Act 2001, listed companies are required to prepare a remuneration report as part of their annual reporting process. ASIC has identified a number of areas where disclosure to shareholders can be improved based on a review of 60 remuneration reports for listed companies for the year ended 30 June 2010.

ASIC notes the following areas where disclosures about remuneration arrangements could be more effective:

  • The board's policy on the nature and amount of remuneration of the key management personnel
  • The non-financial performance conditions in short-term incentive plans
  • Why performance conditions have been chosen
  • The terms and conditions of incentive plans.

Click for ASIC press release (link to ASIC website).

Australian regulator calls for improved disclosure in remuneration reports

29 Jun 2011

The Australian Securities & Investments Commission (ASIC) has called for companies to provide more clarity on the remuneration arrangements for their directors and executives.

Under the Australian Corporations Act 2001, listed companies are required to prepare a remuneration report as part of their annual reporting process. ASIC has identified a number of areas where disclosure to shareholders can be improved based on a review of 60 remuneration reports for listed companies for the year ended 30 June 2010.

ASIC notes the following areas where disclosures about remuneration arrangements could be more effective:

  • The board's policy on the nature and amount of remuneration of the key management personnel
  • The non-financial performance conditions in short-term incentive plans
  • Why performance conditions have been chosen
  • The terms and conditions of incentive plans.

Click for ASIC press release (link to ASIC website).

Malaysia exposes proposals for full convergence with IFRS

29 Jun 2011

The Malaysian Accounting Standards Board (MASB) has issued an exposure draft, MASB Exposure Draft 75 IFRS-compliant Financial Reporting Standards (FRS) as part of achieving full convergence of Malaysian accounting requirements with with IFRS on 1 January 2012.

The existing financial reporting framework in Malaysia is virtually the same as the IFRS framework except for IAS 41 Agriculture, IFRIC 15 Agreements for the Construction of Real Estate, different effective dates and additional transitional provisions in a limited number of standards.

The proposed FRS standards contained in the Exposure Draft are equivalent to the IFRSs issued by the IASB. Therefore, MASB asserts that financial statements drawn up in accordance with the new IFRS-compliant FRS framework will be equivalent to financial statements that have adopted the IFRS framework.

Under the proposals in the Exposure Draft, entities would be required to make, in the notes, an explicit and unreserved statement of compliance with both Financial Reporting Standards (FRSs) and International Financial Reporting Standards (IFRSs).

The MASB has tentatively decided all entities, other than those which meet its definition of a 'private entity', will be required to apply the new IFRS-compliant FRS framework. However, a private entity would be permitted to apply the new IFRS-compliant FRS framework if it decides to do so.

Click for MASB announcement (link to the MASB website).

New edition of IFRSs in your pocket

29 Jun 2011

We have published the tenth edition of our popular guide to IFRSs — IFRSs In Your Pocket 2011.

This 134-page guide includes information about:
  • The IASB organisation — its structure, membership, due process, contact information, and a chronology
  • Use of IFRSs around the world, including updates on Europe, United States, Canada and elsewhere in the Americas, and Asia-Pacific
  • Recent pronouncements - those which are effective and those which can be early adopted
  • Summaries of current Standards and related Interpretations, as well as the Conceptual Framework for Financial Reporting and the Preface to IFRSs
  • IASB agenda projects and active research topics
  • IFRS Interpretations Committee current agenda topics
  • Other useful IASB-related information

We are pleased to grant permission for accounting educators and students to print copies of the PDF file for educational purposes. Please contact your local Deloitte practice office to request a printed copy.

Click for:

Latest batch of editorial corrections to IFRSs released by the IASB

29 Jun 2011

The IASB has posted to its website a new batch of Editorial Corrections to IFRSs.

This batch makes editorial corrections and changes to IFRS for SMEs (issued July 2009), Conceptual Framework for Financial Reporting (issued September 2010), Bound Volume (Red Book) 2011, Bound Volume (Blue Book) 2011, IFRS 10 Consolidated Financial Statements (issued May 2011), IFRS 11 Joint Arrangements (issued May 2011), IAS 19 Employee Benefits (issued June 2011) and Presentation of Items of Other Comprehensive Income (issued June 2011).
Click for:

 

 

UK ASB tentatively revises forthcoming differential reporting framework

28 Jun 2011

As part of its ongoing redeliberations, the UK Accounting Standards Board (ASB) has tentatively agreed to a number of amendments to its proposed revised differential reporting framework, to reduce its impacts on certain entities and extend its proposed application date.

As part of its ongoing redeliberations, the UK Accounting Standards Board (ASB) has tentatively agreed to a number of amendments to its proposed revised differential reporting framework, to reduce its impacts on certain entities and extend its proposed application date.

The ASB published its published its proposals for the future of financial reporting in the UK and Republic of Ireland in October 2010 (see our earlier story). The Exposure Drafts set out proposals for a three-tier reporting framework, with the aim of balancing the needs of preparers and users of accounts.

At its meeting held on 16 June 2011, the ASB made the following tentative decisions:

  • To remove from FRED 43 Application of Financial reporting Requirements and FRED 44 Financial Reporting Standard for Medium-sized Entities (FRSME), the requirement for publicly accountable entities to prepare accounts under EU-adopted IFRS. As a consequence the application of EU-adopted IFRS will not be extended beyond the current requirements in law. This measure will particularly assist certain charities that would otherwise be captured as having "public accountability"
  • To change the principles for amending the IFRS for SMEs in developing the FRSME (to be applied by all entities other than those required to comply with EU-adopted IFRS and small companies), to permit or require accounting options that exist in current UK and Republic of Ireland Financial Reporting Standards at the transition date that align with EU-adopted IFRS
  • To defer the proposed effective date of the proposals to 1 January 2014 (instead of 1 July 2013), to allow time for the creation of a new exposure draft of the FRSME.

Click for the ASB meeting summary (link to the UK Financial Reporting Council website).

Singapore releases Accounting Standard for charities

28 Jun 2011

The Singapore Accounting Standards Council (ASC) has issued an Charities Accounting Standard (CAS), which is tailored to meet the needs of the charity sector and its stakeholders.

The ASC's new financial reporting framework for charities will apply to charities when they prepare their financial statements for financial periods beginning on or after 1 July 2011. Most charities can choose to adopt the Singapore Financial Reporting Standards (FRS) or the CAS based on their own needs and operations.

In developing the CAS, the ASC took reference from the IFRS for SMEs, the Financial Reporting Standard for Smaller Entities (FRSSE) issued by the Accounting Standards Board of the United Kingdom, and other sources.

Click for ASC announcement (link to the ASC website).

Agenda for IFRS Foundation Trustees meetings

28 Jun 2011

The IFRS Foundation Trustees will meet in New York on Wednesday and Thursday, 13 and 14 July 2011. The tentative agenda is shown below.

Agenda for the IFRS Foundation Meetings
Wednesday and Thursday, 13 and 14 July 2011
Wednesday 13 July (13:00-14:15)
  • Meeting with IFRS Foundation Monitoring Board
    • Discussion of governance and strategy reviews
    • Update on due process oversight, convergence work and IFRS use throughout the world
Thursday 14 July (09:00-12:00)
  • Report of the Due Process Oversight Committee
  • Report from the IASB Chair
  • Update on the IFRS for SMEs
  • Report of the IFRS Advisory Council Chair
  • Report of the Executive Committee on the status of the Strategy Review

Singapore Exchange releases sustainability reporting guide

27 Jun 2011

The Singapore Exchange (SGX) has introduced a Sustainability Reporting Guide (the "Guide") for its listed companies.

The release of the Guide follows a public consultation process that commenced in August 2010 regarding disclosure and accountability for operating and developing businesses in a sustainable manner (see our earlier story).

Within the Guide, the Policy Statement sets out the principles and the Questions and Answers guide listed companies in extending their reporting beyond financial governance to sustainability aspects. The Guide references ISO 26000 Guidance on Social Responsibility and the Global Reporting Initiative (GRI) Sustainability Reporting Guidelines for listed companies seeking detailed guidance on sustainability reporting.

The Policy Statement and Sustainability Reporting Guide are applicable to Mainboard and Catalist companies listed on SGX. The Guide is not mandatory, but the SGX encourages all its listed companies to consider sustainability reporting as an integral part of good corporate governance and notes "conceivably, there will be progress towards mandatory reporting through regulations and rules in the future".

Both Policy Statement and the Guide are available on www.sgx.com (link to SGX website). Click for SGX announcement (link to the SGX website).

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