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Annual improvements — 2011-2013 cycle

Background

The IASB's annual improvements project provides a streamlined process for dealing efficiently with a collection of amendments to IFRSs. The primary objective of the process is to enhance the quality of standards, by amending existing IFRSs to clarify guidance and wording, or to correct for relatively minor unintended consequences, conflicts or oversights. Amendments are made through the annual improvements process when the amendment is considered non-urgent but necessary.

Each year the IASB discusses and decides upon proposed improvements to IFRSs as they have arisen throughout the year. Issues dealt with in this process arise from matters raised by the IFRS Interpretations Committee and suggestions from staff or practitioners.

In order to be included in the annual improvements process, the proposed amendments must meet all of the following criteria (summarised), as published in the Due Process Handbook (revised in February 2011):

  • The proposed amendment either clarifies existing standards, or corrects conflicts or oversights, but does not propose a new principle or a change to an existing principle
  • The proposed amendment is well defined and sufficiently narrow in scope such that the consequences of the proposed change have been considered
  • It is probable that the IASB will reach conclusion on the issue on a timely basis
  • If a proposed amendment would amend IFRSs that are subject of a current or planned IASB project, there must be a need to make the amendment sooner than the project would.

Once this assessment is made, the proposed amendments follow the same due process as other IASB projects. Proposals are generally published in the third quarter of the year with a comment period of 90 days.

From January 2010, the IFRS Interpretations Committee has taken on the additional roe of reviewing proposed amendments within the annual improvements process and making recommendations to the IASB.

 

Current status of the project

The IASB published Exposure Draft ED/2012/2 Annual Improvements to IFRSs (2011—2013 Cycle) on 20 November 2012, with comments due by 18 February 2013.  Finalised amendments are expected in the fourth quarter of 2013.

 

Project milestones

DateDevelopmentComments
20 November 2012 ED/2012/2 Annual Improvements to IFRSs (2011—2013 Cycle) published Comment deadline 18 February 2013

Related Discussions

  • Due process papers (IASB only)

  • Oct 19, 2012

  • The Board discussed the proposed amendments to IAS 28 and the annual improvements cycle 2011-2013, deciding to issue a separate exposure draft for the proposed amendments to IAS 16 and IAS 38 on revenue based depreciation and amortisation.

  • IAS 7 — Examples illustrating the classification of cash flows

  • Jul 10, 2012

  • The Committee discussed the staff’s analysis of six examples that illustrate the classification of cash flows which was aimed at testing the principle (using the first principle as the primary guidance principle) for classification of the cash flows noted above and to determine how existing guidance in IAS 7 could be clarified.

  • Issues from the IFRS Interpretations Committee

  • Jun 14, 2012

  • The IASB discussed two issues recently considered by the IFRS Interpretations Committee: (1) Application of the equity method when an associate’s equity changes outside comprehensive income (2) Meaning of effective IFRSs in IFRS 1.

  • Annual improvements 2011-2013 cycle

  • Apr 16, 2012

  • The IFRS Interpretations Committee (the Committee) previously considered a request to clarify the meaning of the term ‘consumption of the expected future economic benefits embodied in the asset´ in paragraphs 97 and 98 of IAS 38 Intangible Assets when determining the appropriate amortisation method for intangible assets of service concession arrangements. The request included a specific fact pattern where the tariff chargeable to users is contracted in the agreement and a lower tariff is imposed at the beginning of the concession and increases periodically in line with the grantor´s practice so as not to burden consumers.

  • IAS 16 and IAS 38 — Revenue-based depreciation method

  • Mar 13, 2012

  • The IFRS Interpretations Committee discussed the proposed amendment to IAS 38 and IAS 16 as part of the annual improvements project (2011-2013 cycle) which noted that a revenue-based method is not considered to be an appropriate method of amortisation.

  • Annual improvements — 2010-2013 cycle

  • Mar 02, 2012

  • The IASB considered two topics for possible annual improvements in the next cycle: (1) IFRS 3 — Scope exclusion for the formation of a joint venture (2) IFRS 3 — Definition of a business (interaction with IAS 40).

  • IFRS 3 – Definition of a business (continuing)

  • Nov 03, 2011

  • The Committee had previously received a request for clarification on whether an asset with relatively simple associated processes meets the definition of a business in accordance with IFRS 3 'Business Combinations'.

All Related