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IFRS 1 – Replacement of 'fixed dates'

Background

IFRS 1 First-time Adoption of International Financial Reporting Standards requires a first-time adopter to restate past derecognition transactions that occurred after 1 January 2004. This requirement was included in IFRS 1 as a result of the revision to IAS 39 Financial Instruments: Recognition and Measurement in 2003, to place entities then adopting IFRSs for the first
time in the same position as existing IFRS users at that time.

As time passes, the fixed transition date of 1 January 2004 becomes more remote and increasingly less relevant to the financial reports of additional jurisdictions that will adopt IFRSs.

Accordingly, this project was initiated to consider an amendment to IFRS 1 by replacing references to a fixed transition date of ‘1 January 2004’ with ‘the date of transition to IFRSs’.

As a result, entities adopting IFRSs for the first time would not have to restate derecognition transactions that occurred before the date of transition to IFRSs. In addition, first-time adopters would also not have to recalculate ‘day 1’ differences on initial recognition of financial instruments, where the transaction occurred before the date of transition to IFRSs.

 

Current status of the project

This project has been completed. The IASB issued Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters on 20 December 2010.

 

Project milestones

DateDevelopmentComments
July 2010 Added to the IASB's agenda Recommendation made by the IFRS Interpretations Committee
26 August 2010 Exposure Draft ED/2010/10 Removal of Fixed Dates for First-time Adopters published Comment deadline 27 October 2010
20 December 2010 Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters issued
 Effective for annual periods beginning on or after 1 July 2011

Related Discussions

  • IFRS 1 – Removal of fixed dates

  • Nov 16, 2010

  • The Board discussed the staff's analysis of the comment letters received on the exposure draft 'Removal of Fixed Dates for First-time Adopters' published in August 2010.

  • Amendments to IFRS 1 - Fixed dates

  • Jul 21, 2010

  • The IASB discussed the recommendation made by the IFRS Interpretations Committee on replacing the fixed date of '1 January 2004' in IFRS 1, relating to the derecognition exception and the fair value measurement of financial assets or liabilities at initial recognition, with a more relevant date.

  • IFRS 1 — Fixed date in derecognition exception

  • Jul 08, 2010

  • The IFRS Interpretations Committee agreed with the staff recommendation to replace the fixed date with the phrase “date of transition to IFRSs” as a separate project to amend IFRS 1.

  • IFRS 1 — Hard-wire dates

  • Mar 05, 2010

  • The IFRIC discussed an exception that IFRS 1 provides from full retrospective application of the requirements for derecognition of financial assets and financial liabilities in IAS 39 for transactions before 1 January 2004.

All Related