In coming to its tentative negative agenda decision, the Interpretations Committee had argued that the issue was too complex to deal with in a narrow-scope project and that informal feedback received from individual IASB members had indicated that there was "little appetite to take on such a project".
Reactions from constituents (including ESMA, the Japanese standard-setter ASBJ, the German standard-setter ASCG, and Deloitte) were quite sharp in some cases given that (i) neither IAS 39 nor IFRS 9 include requirements that are sufficient regarding the modification of financial assets, which leads to a risk of divergence in accounting practice; (ii) the modification of financial assets is already an issue that arises in practice; (iii) such transactions are likely to increase given the current economic environment; and (iv) potential issues that could arise under IFRS 9. One comment letter states:
We consider the decision being inappropriate given that there is an issue in practice. While the IFRS IC take the view that it is not appropriate to progress with the issue "at this time" and that it cannot be resolved "through an interpretation", we point to the fact that there are other means to address an issue, even in case it is a broad one.
And another adds:
Indeed, this issue has been a contentious area for some years and has been discussed by the Committee in every year from 2012 to 2015.
The issue is set to be discussed at the upcoming meeting of the IFRS Interpretation Committee on 22 March 2016 from 4.40pm. Despite the comments received (all but one advocate further action) the staff recommends finalising the agenda decision with only a few suggested editorial changes as the comment letters received did not reveal any new information.
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