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News

Deloitte partner is new ISAR chair

15 Dec 2004

Abbas Ali Mirza, a partner in the Dubai office of Deloitte & Touche (Middle East), has been elected as the chair of the United Nations' Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting (ISAR) for a one-year term that continues until November 2005. For more information about ISAR Click Here.

Abbas has also been appointed to the Developing Nations Permanent Task Force (DNPTF) of the International Federation of Accountants (IFAC).

"Heads Up" on SEC/PCAOB conference

15 Dec 2004

Annually, the American Institute of Certified Public Accountants hosts a conference featuring speeches by, and question and answer sessions with, members and staff of the SEC, the Public Company Accounting Oversight Board, and other standard-setters.

Deloitte (USA) has published a 26-page issue of its (PDF 328k) that summarises all of the presentations. Several of them address international issues and convergence of US GAAP and IFRSs. In our news story of 12 December 2004, we have links to two speeches that most directly focus on IFRSs.

Public Sector Accounting Standards Board update

15 Dec 2004

The International Public Sector Accounting Standards Board – formerly known as the Public Sector Committee – has published its PSC Update November 2004 (PDF 237k).

You can find more information about the IPSASB Here.

EFRAG may not support IFRIC 3

15 Dec 2004

At its meeting on 8-10 December 2004, the European Financial Reporting Advisory Group (EFRAG) agreed to recommend that the European Commission endorse a number of pronouncements for use in Europe, but noted "serious concerns" about IFRIC 3 'Emission Rights'.

The following were recommended for endorsement: IFRS 6; the IAS 39 amendment for transition; the amendments to IAS 19 Employee Benefits; and IFRIC Interpretations 2, 4, and 5.

However, with regard to IFRIC 3 Emission Rights, a majority of EFRAG members have "serious concerns about the information resulting from application of this IFRIC".

EFRAG's meeting notes indicate that those concerns "could result in a negative advice" to the Commission. The draft endorsement advice letter will be discussed again at EFRAG's January meeting.

 

PCAOB proposes ethics and independence rules

14 Dec 2004

The US Public Company Accounting Oversight Board (PCAOB) has proposed certain ethics and independence rules for public comment.

The rules, which relate to tax services provided to audit clients and contingent fees, would apply to audits of all listed companies, including foreign SEC registrants. Click for link to Press Release on PCAOB Website. The PCAOB's proposal is supported by SEC Chief Accountant Donald T. Nicolaisen. The SEC's Announcement said: "Although the Commission historically has adopted its own rules and interpretations regarding auditor independence issues - and will continue to provide companies and audit committees with guidance on independence issues - Nicolaisen stated that he looks forward to the PCAOB fulfilling its role and becoming the primary standard-setter and source of guidance to auditors on these issues."

ARC will consider endorsement of IFRS 2

13 Dec 2004

The Accounting Regulatory Committee of the European Commission will meet on 20 December 2004 in Brussels to consider whether to recommend endorsement of IFRS 2 Share-based Payment for use in Europe.

Comments on IFRSs at annual AICPA SEC conference

12 Dec 2004

A number of SEC speakers at the 32nd Annual AICPA National Conference on Current SEC and PCAOB Developments addressed international financial reporting issues.

Links to the presentations of SEC Chief Accountant Donald T. Nicolaisen and SEC Deputy Chief Accountant Julie A. Erhardt whose area of responsibility is international financial reporting are below. Here is an excerpt from Mr. Nicolaisen's remarks:

Anticipating that investors will embrace IFRS, OCA is considering the steps that need to be taken to allow us to eliminate the reconciliation from IFRS to U.S. GAAP. One such step is to review the quality and consistency of the application of IFRS. While a great many non-U.S. companies register securities with us, currently less than 50 of these registrants use IFRS for their primary financial statements. This will change in 2005 as we expect perhaps as many as five hundred of those filing with us to use IFRS. I recognize that, within Europe, some companies may not fully apply IFRS, but my expectation and hope is that the majority of those companies that file with the Commission will fully comply with IAS, including accounting for derivatives.

We are gearing up for a review of these filings, which will be available for our review in the second half of 2006, to take advantage of the knowledge that can be gained from studying such a large number of IFRS-based financial statements. As part of the study, we will carefully review what differences exist between U.S. GAAP and IAS, and I will strongly encourage the FASB and the IASB to eliminate many of these differences as quickly as possible. Throughout this process, we will be working with preparers, the IASB, FASB, and other regulators to gather information on the experience and knowledge of those adopting IFRS for their 2005 filings.

Standard on extractive industries is issued

10 Dec 2004

The International Accounting Standards Board has issued IFRS 6 'Exploration for and Evaluation of Mineral Resources'.

The standard provides guidance on accounting for exploration and evaluation costs incurred by entities in the mining and oil and gas exploration industries.

IFRS 6 permits an entity to continue using, under IFRSs, the accounting policies applied in its most recent annual financial statements for exploration and evaluation expenditures, including the recognition and measurement of exploration and evaluation assets.

The standard requires an impairment test for such assets, but it varies the recognition of impairment from that in IAS 36 Impairment of Assets. However, if impairment is identified, measurement of impairment must be in accordance with IAS 36.

IFRS 6 is effective for annual periods beginning on or after 1 January 2006. However, earlier application is encouraged, and if an entity adopts IFRS 6 before 1 January 2006, transitional relief is available for some comparative disclosures. Click for IASB Press Release (PDF 28k).

 

Agenda for IASB meeting December 2004

08 Dec 2004

The IASB has posted the agenda for its December 2004 Board meeting, which will be held at the IASB's offices in London on 15 to 17 December 2004. The agenda is as follows:IASB Meeting Agenda, 15-17 December 2004, London Wednesday 15 December 2004 Financial Guarantees and Credit Insurance [Education Session] IAS 39 – Cash Flow Hedge Accounting of Forecast Intra-group Transactions [Education Session] Business Combinations Phase II – Purchase Method Procedures Amendments to IAS 37 Amendments to IAS 39 - Transition and Initial Recognition of Financial Assets and Liabilities - Sweep Issues IFRIC Update Thursday 16 December 2004 (afternoon) Revenue Recognition Accounting Standards for Small and Medium-sized Entities Friday 17 December 2004 (morning) Amendments to IAS 39 – Fair Value Option ED 7 Financial Instruments: Disclosures – Comment Letter Analysis .

The IASB has posted the agenda for its December 2004 Board meeting, which will be held at the IASB's offices in London on 15 to 17 December 2004. The agenda is as follows:

IASB Meeting Agenda, 15-17 December 2004, London

Wednesday 15 December 2004

EC Commissioner speaks about IFRSs

07 Dec 2004

Charlie McCreevy, the new European Commissioner for Internal Market and Services, offered his assessment of the integration of the single European market for financial services at a conference sponsored by the Committee of European Securities Regulators in Paris yesterday.

He noted the importance of IFRSs for the single market. Click to (PDF 86k).

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