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Agenda published for the April 2015 IFRS Foundation Trustees meeting

07 Apr 2015

The agenda for the public session of the upcoming meeting of the IFRS Foundation Trustees, which will be held in Toronto, Canada on 14-16 April 2015, is now available. The Trustees' Due Process Oversight Committee will also meet during this time.

The agendas for the two public sessions of the meeting are summarised below:

Tuesday, 14 April 2015

Due Process Oversight Committee meeting (13:00–14:45 EDT (local time); 18:00–19:45 BST)

  • Introduction
  • Update on technical activities
  • Leases: due process ‘lifecycle’ review
  • Post-Implementation Review of IFRS 3 Business Combinations: draft report and feedback statement
  • Education materials: update
  • Consultative groups and DPOC engagement update
  • Correspondence update
  • Summary

Thursday, 16 April 2015

IFRS Foundation Trustees meeting (12:15–1:15 EDT (local time); 17:15–18:15 BST)

  • Report of the Chair of the IFRS Foundation Trustees
  • Report of the IASB Chair
  • Report of the Due Process Oversight Committee

Agenda papers for the meeting are available on the IASB's website (DPOC meeting papers are included as agenda paper 3).

The Trustees meeting will also include various other events, including a webinar, a speech by IASB Chairman Hans Hoogervorst and a panel discussion. More information on the planned activities are available on the website of the Canadian Accounting Standards Board (see decision summary of the March 2015 meeting under "IFRS Foundation Trustees".)

South African study into how integrated reporting fosters integrated thinking and better decision-making

07 Apr 2015

The South African Institute of Chartered Accountants (SAICA) has published the results of a survey that show that among organisations that produce high-quality integrated reports there is a strong awareness of the concept of integrated thinking and how it benefits the organisation. However, the survey also shows that many aspects of integrated thinking are not yet fully understood.

Under the listing rules of the Johannesburg Stock Exchange (JSA), South African companies listed on the exchange have for a number of years been required to produce, on a 'comply or explain' basis, an integrated report following the King Report on Governance for South Africa and the King Code of Governance Principles ('King III') developed by the Integrated Reporting Committee (IRC) of South Africa. In March 2014, the IRC also endorsed the International Integrated Reporting Framework, issued in December 2013 by the International Integrated Reporting Council (IIRC), as guidance on good practice on how to prepare an integrated report. The purpose of the survey now published by SAICA was to distil a perspective on the current state of integrated thinking practice in South Africa. At the same time it offers insights into how integrated thinking gains traction in a jurisdiction that has been practising integrated reporting for several years.

The survey shows that:

  • more than 70% of respondents believe that integrated reporting has been a driver of integrated thinking;
  • more than 70% are convinced that integrated thinking has improved decision-making at the management as well as at the board level;
  • more than 65% state that integrated thinking has helped organisations to develop a more cohesive approach to reporting;
  • more than 70% see that integrated thinking has increased the quality of organisations' dialogue with providers of financial capital and other stakeholders; and
  • more than 70% expect that organisations will derive further benefits in the short, medium and long term from integrated thinking.

However, the survey results also show that to date few organisations seem to be using the capitals model outlined in the IIRC Framework to identify and manage their capitals and do not use special tools to measure or manage the impact that capitals have on the business, or on each other, or to enhance integrated thinking, even though there does seem to be an awareness of the six capitals and that these contribute to the value creation process. The authors conclude:

This project has highlighted that many aspects of integrated thinking are not yet understood. Much research and development is needed to guide organisations on the road they must travel to integrated thinking and its consequent reporting. Looking to the future, we believe that organisations will increasingly recognise the significant benefits of integrated thinking to enhance their competitiveness and support their sustainability from all perspectives.

Please click to access the full report on the SAICA website.

EFRAG appoints three new TEG members

02 Apr 2015

The Board of the European Financial Reporting Advisory Group (EFRAG) has announced the appointment of three new members of its Technical Experts Group (TEG). The appointments are a consequence of EFRAG's new governance structure and one current TEG member stepping down from her role.

As of 1 April 2014, under its new structure, the EFRAG TEG consists of a maximum of 16 members of which at least four members are nominated by the standard-setters of France, Germany, Italy and the UK. Its new role is to provide technical advice to the EFRAG Board who will be responsible for all EFRAG positions.

The two newly-appointed members are Heinz Hense from ThyssenKrupp (Germany), and Ambrogio Virgilio from EY (Italy). As of 1 June 2015, Andrew Spooner from Deloitte (United Kingdom) will replace current TEG member Joanna Frykowska, who will be stepping down from her role.

Please click for the press release on the EFRAG website.

Agenda for the first face-to-face meeting of the ITG

02 Apr 2015

The agenda has been released for the upcoming meeting of the Transition Resource Group for Impairment of Financial Instruments (ITG), which is being held at the offices of the IASB on 22 April 2015.

The ITG was created to keep the IASB informed on issues occurring during implementation of the new impairment requirements in IFRS 9 Financial Instruments, to assist in determining what action may be needed to resolve diversity in practice and to provide a public forum for stakeholders to learn about the new impairment requirements from others involved with implementation. The first face-to-face meeting of the group was originally planned for the last quarter of 2014 but was replaced by a conference call to discuss operating procedures and the status of implementation as not enough substantive technical implementation issues that meet the submission criteria had been received by then.

The agenda for the meeting is as follows:

Wednesday, 22 April 2015, 09.30-15.30

  • Introductory remarks
  • The maximum period to consider when measuring expected credit losses
  • Forecasts of future economic conditions
  • Loan commitments – Scope
  • Revolving credit facilities
  • Assessment of significant increase in credit risk for guaranteed debt instruments
  • Measurement of expected credit losses for an issued financial guarantee contract
  • Expected credit losses - measurement date
  • Measurement of expected credit losses in respect of a modified financial asset

Agenda papers for this meeting will be made available on the IASB's website closer to the meeting.

CDSB and WBCSD to develop mapping tool for sustainability reporting

02 Apr 2015

The Climate Disclosure Standards Board (CDSB) and the World Business Council for Sustainable Development (WBCSD) are jointly developing a web-based tool and database to help companies understand and navigate the corporate sustainability reporting landscape.

As the information companies are required to disclose in their annual, sustainability or integrated reports varies and the landscape of reporting frameworks, regulation, policies, standards and guidance is diverse and complex, WBCSD and CDSB have launched a three year "Reporting Landscape Mapping" project. The project aims to develop a web-based tool and database that will help business navigate the corporate sustainability reporting landscape and assess which rules, methods or practices are relevant and applicable to them. WBCSD and CDSB hope that this will enhance and consolidate the disclosure of sustainability information in corporate reporting and encourage the convergence of reporting. The first pilot version of the database is planned for late autumn 2015.

Please click for more information on the CDSB website. WBCSD and CDSB are also looking for companies that would like to contribute to the development process and participate in the pilot programme.

TRG discusses implementation of new revenue standard

01 Apr 2015

At its 30 March 2015 meeting, the joint revenue transition resource group (TRG) and IASB and FASB board members discussed potential issues related to implementing the boards’ new revenue standard.

Topics discussed at the meeting included:

  • Allocation of the transaction price for discounts and variable consideration
  • Material rights
  • Consideration payable to a customer
  • Partially satisfying performance obligations before identifying the contract
  • Warranties
  • Significant financing components
  • Whether contributions are within the scope of the new revenue standard

For more information, see Deloitte’s TRG Snapshot.

At a separate FASB meeting on Wednesday, 1 April 2015, the FASB tentatively decided to defer the new revenue standard for one year. It is currently unclear whether the IASB will defer the effective date of IFRS 15; the IASB plans to discuss this issue later in April. For more information on the FASB's deferral, see Deloitte's Heads Up newsletter.

US FASB tentatively decides to defer the new revenue standard

01 Apr 2015

At its meeting today, the US Financial Accounting Standards Board (FASB) tentatively decided to defer for one year the effective date of the new revenue standard (ASU 2014-09 'Revenue From Contracts With Customers') for public and nonpublic entities reporting under US GAAP.

The Board also tentatively decided to permit entities to early adopt the standard. The tentative decisions will be exposed in an upcoming proposed Accounting Standards Update (ASU) with a 30-day comment period.

It is currently unclear whether the IASB will defer the effective date of IFRS 15 Revenue from Contracts with Customers; the IASB plans to discuss this issue later in April.

For more information, see Deloitte (United States) related Heads Up newsletter and the tentative board decisions on the FASB's website.

We comment on the proposed amendments to IAS 7

01 Apr 2015

We have published our comment letter on the International Accounting Standards Board's (IASB) Exposure Draft ED/2014/6 'Disclosure Initiative (proposed amendments to IAS 7)'.

The IASB's proposed amendments aim at clarifying IAS 7 to improve information provided to users of financial statements about an entity's financing activities and liquidity. In our comment letter, we support the Board's Disclosure Initiative, but believe that it is premature to make additional disclosure requirements of the sort proposed in the ED ahead of discussions on the Principles of Disclosure element of that project.

Click to access the full comment letter.

IPSASB finalises proposals on reporting service performance information

01 Apr 2015

The International Public Sector Accounting Standards Board (IPSASB) has published Recommended Practice Guideline 3 (RPG 3) that provides guidance on the reporting of service performance information. The RPG is designed to allow public sector entities to be held accountable through the provision of high quality service performance information, by providing guidance on how such information should be presented, and its recommended characteristics.

RPG 3 follows an exposure draft published in 2013 and an earlier consultation paper released in 2011. It responds to the perceived need for a principles-based and consistent framework for service performance information that focuses on user needs. The press release states:

Service provision is the primary function of the vast majority of public sector entities. Service performance information is essential for users to evaluate the services provided and public sector entities' efficient and effective use of resources to deliver those services. RPG 3 provides guidance to support the quality of service performance information already reported by entities and offers a useful framework for entities that have not yet started to report service performance information.

The guidance in RPG 3 Reporting Service Performance Information aligns with the IPSASB's view that public sector financial reporting has a greater scope than financial statements alone. Therefore, it:

  • provides principles applicable to the presentation of service performance information and definitions that establish a standardised service performance information terminology;
  • addresses the reporting entity and reporting period for service performance information;
  • provides guidance on the choice of performance indicators that show an entity's achievements with respect to its service performance objectives, disclosures about the basis of the reported information, and service performance-related narrative discussion and analysis; and
  • states that service performance information may be presented either in the same report as the financial statements or in a separate report, and identifies factors to consider when making that decision.

RPGs are considered 'good practice', are not mandatory, and do not need to be applied in order for a public sector entity to comply with International Public Sector Accounting Standards (IPSAS).

Please click for the following additional information on the IPSASB website:

Feedback on the EFRAG Discussion Paper on the classification of claims

31 Mar 2015

The European Financial Reporting Advisory Group (EFRAG) has published a feedback statement summarising the main messages from respondents to EFRAG’s Discussion Paper 'Classification of Claims'.

The paper, published in July 2014, was aimed at assisting the IASB in the development of its project on distinguishing between equity and liabilities in the context of the revision of the Conceptual Framework for Financial Reporting. The EFRAG paper addressed the classification of claims in general and thus went beyond the discussion around the mere distinction between equity and liabilities. Respondents to the Discussion Paper generally supported the identified framework but most respondents considered that current binary classification model in IFRS should be retained, with a negative definition of equity and refinement of the positive definition of a liability. The Discussion Paper and reactions to it were discussed at the last ASAF meeting.

The feedback statement is available on the EFRAG website.

Correction list for hyphenation

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