Disclosure initiative

The ASAF members discussed an Exposure Draft published by the Brazilian Accounting Standards Committee proposing that immaterial information should not be disclosed and that this should be enforced. They also considered a comment letter by the European Financial Reporting Advisory Group (EFRAG) on the consultation on alternative performance measures launched by the European Securities and Markets Authority (ESMA) and discussed whether the IASB was the appropriate organisation to address non-IFRS information. Finally, they considered the FASB's work on its disclosure framework project.

Equity method of accounting

The ASAF discussed a paper introduced by the IASB staff that sought input from ASAF members on the scope of the research project on the equity method of accounting. During the discussion, some ASAF members suggested that it might be useful to consider the project in two stages: a short-term simplification project and a long-term conceptual review of the application of the equity method. The discussion also made reference to the EFRAG paper and the KASB paper on this topic.

Insurance contracts

The ASAF considered the release of the contractual service margin for non-participating contracts, contracts with participating features, whether the IASB should develop a separate model for contracts with participating features, whether the shareholders' share of returns from underlying items should unlock the contractual service margin, and whether there should be specific requirements for options and guarantees.

Macro hedging

The IASB staff wanted to gather initial feedback from the ASAF members on the main areas of the Discussion Paper DP/2014/1 Accounting for Dynamic Risk Management: a Portfolio Revaluation Approach to Macro Hedging. The discussion assessed the need for an accounting approach, the scope of the application of the portfolio revaluation approach and other risks. There was overall agreement that before going ahead with the approach, there would need to be acceptance of the consideration of behaviouralisation. ASAF members also considered issues in connection with revaluation and transfer pricing transactions as well as operational complexity and OCI.

Conceptual framework

ASAF members discussed the reporting of income and expenses and the choice of measurement based on a paper by the Financial Reporting Council (UK), suggesting a justification for a mixed measurement model and principles for distinguishing between profit or loss and other comprehensive income.

A full summary of the meeting is available on the IASB's website. The ASAF's next meetings will be on  25 and 26 September 2014 and on 4 and 5 December 2014.