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29 August 2002: IASB improvements will be adopted in Australia
The Australian Accounting Standards Board has proposed to harmonise Australian accounting requirements with any revised International Financial Reporting Standards (IFRS) resulting from IASB's Improvements ED. That could result in a diverse range of changes, including the disclosure of forward looking information and the measurement of transactions based on ‘functional currencies'. The latest Australian Accounting Alert published by Deloitte Touche Tohmatsu Australia has details.
28 August 2002: SEC requires certifications by non-US CEOs and CFOs
Yesterday, the US Securities and Exchange Commission voted unanimously to require CEOs and CFOs of all registered companies to personally certify that their companies' annual and quarterly financial statements do not contain any untrue statement of a material fact, do not omit a material fact, and fairly present in all material respects the financial condition and results of operations of the issuer. The new rules, which are effective today, apply to the principal executive and financial officers of any issuer that files quarterly and annual reports with the Commission under either Section 13(a) or 15(d) of the Exchange Act, including foreign private issuers and small business issuers. Click for SEC Press Release (PDF 57k).
28 August 2002: Deloitte Touche Tohmatsu policy on IFRS terminology
The new Preface to International Financial Reporting Standards (IFRSs), issued in April 2002, states that "when the term IFRSs is used..., it includes standards and interpretations approved by the IASB, and International Accounting Standards (IASs) and SIC interpretations issued under previous Constitutions." Consistent with the Preface, Deloitte Touche Tohmatsu is recommending that its clients' financial statements indicate, in the "basis of preparation" note, that the financial statements are prepared on the basis of IFRS, rather than IAS. In that case, the Firm's audit report will also refer to IFRS. Because no final IFRS has actually yet been issued by IASB, DTT will not yet insist that its clients refer to IFRS. If a client chooses to continue to refer to IAS, the Firm's audit report will be consistent with the client's terminology. However, as soon as the first new IFRS is issued and effective, both the client's financial statements and the Firm's audit report must adopt the IFRS terminology.
28 August 2002: New project page: Liabilities and revenue recognition
IASB's work programme now includes a project on Liabilities and Revenue Recognition. The project addresses certain key interrelated conceptual issues that underlie financial reporting:
- The distinction between liabilities and equity.
- Liability recognition, including guidance on whether an item meets the definition of a liability and, if so, the criteria for recognising liabilities in the financial statements.
- General principles for determining when revenue should be recognised in the financial statements.
IASB staff are working directly on the revenue recognition component of the project. The IASB is working with the US Financial Accounting Standards Board on the liability definition and recognition components.
27 August 2002: Valuation standards proposed for real property
The International Valuation Standards Committee has issued an exposure draft on Mass Appraisal of Real Property. IVSC currently has three other EDs outstanding, covering the valuation of Agricultural Property, of Personal Property, and of Mortgage Portfolios. Comments on all four are requested by end December 2002. The EDs may be downloaded from IVSC's Website. IVSC has also announced that the next edition of its bound volume of International Valuation Standards – due early 2003 – will be made available without charge on its website; printed copies will also be available for purchase.
27 August 2002: Two new Deloitte & Touche publications
- The entire July-August 2002 issue of the Deloitte & Touche newsletter For the Record (PDF 232k) addresses Accounting for Revenue in Today's Business Environment. The newsletter discusses FASB, SEC, and AICPA accounting requirements for revenue recognition, particularly those that apply to arrangements involving multiple elements or up-front or contingent fees.
- The entire 18 July 2002 issue the Deloitte & Touche newsletter Heads Up (PDF 61k) summarises and analyses FASB's Exposure Draft of a Proposed Interpretation, Consolidation of Certain Special-Purpose Entities.
27 August 2002: Agenda for IASB September meeting
IASB has added a fourth day to its meeting next month, now scheduled for 17-20 September at the offices of the US Financial Accounting Standards Board in Norwalk, Connecticut. The IASB Board will meet on its own on 17, 19, and 20 September to discuss
Share-Based Payment, Business Combinations (Phase I if required, and Phase II), Reporting Performance, Convergence, Revenue and Liability Recognition, IFRIC Matters, and Insurance Contracts. On 18 September, IASB and FASB will hold a joint meeting. Click for Details.
26 August 2002: New Accounting Roundup newsletter posted
We have posted the 26 August 2002 edition of the Accounting Roundup newsletter from Deloitte & Touche USA. It covers stock options, sworn statements to SEC by CEOs and CFOs, sustainability reporting, IASB exposure drafts, corporate governance reforms at the NYSE, and recent Deloitte & Touche publications on revenue recognition and special purpose entities.
18 August 2002: Agenda for the 28-29 August IFRIC meeting is announced
The International Financial Reporting Interpretations Committee will meet on 28 and 29 August at the IASB's offices in London to discuss the following issues:
- Derivatives on interests in subsidiaries, associates, and joint ventures. Such derivatives arise when a parent or investor contracts either to buy some of the shares in the investee that it does not already own or to sell some of its present holding.
- IAS 19: Employee Benefits – measurement of the pension asset ceiling when the employer expects refunds and reductions in future contributions.
- Revenue with multiple elements – revenue recognition when the seller agrees to deliver or perform multiple products, services, and/or rights to use assets.
- Rights of use – when do rights of use constitute a lease transaction that should be accounted for in accordance with IAS 17, Leases.
- Transactions with owners and common control transactions.
17 August 2002: Changes to IASB's project timetable
IASB has indicated that target dates for publications on several active projects have been postponed:
- Exposure Draft (ED) on Business Combinations is now expected in 4th quarter 2002, with a final Standard in the second half of 2003.
- ED on Activities of Financial Institutions is now planned for 1st quarter 2003, with a final Standard by the end of 2003.
- The Insurance project has been split into two phases. The first phase will focus on presentation and disclosure, application of IAS 39 to some insurance contracts, and eliminating a limited number of existing practices that are inconsistent with the IASB Framework, including elimination of catastrophe and equalisation provisions and offsetting of reinsurance. The ED for Phase 1 is now planned for 1st quarter of 2003, with a final Standard in 2004. Phase 2 will develop a comprehensive standard for insurance contracts (timetable not yet established).
- Final Standards resulting from the Improvements Project and Amendments to IAS 32 and 39 are still on target for 1st quarter 2003.
Click for our complete Project Timetable.
16 August 2002: European Parliament considers a uniform prospectus for Europe
The European Commission has presented to Parliament an amended proposal for a uniform prospectus to be used for securities offerings throughout Europe – a 'single passport' to all of the European capital markets. Once the proposal becomes law (a Directive), then a prospectus approved by securities authorities in one member state must be accepted in all other states. The proposal sets out the minimum content for a prospectus and how it should be presented, based on Disclosure Standards adopted in 1998 by IOSCO. Required disclosures would include key information on risk factors, related-party transactions, corporate governance, and management's discussion and analysis, none of which is currently required by the existing EU Directive on prospectuses. The specific financial statements, periods covered by them, and other information of a financial nature to be included in prospectuses will be established by EC regulation within 180 days of adoption of the proposed Directive. The EC's goal is final approval of the Directive by the end of 2002. Click for:
14 August 2002: New Accounting Roundup newsletter posted
The 12 August 2002 edition of the Accounting Roundup newsletter from Deloitte & Touche USA covers stock options, disposal activities, US accounting reform legislation, the SEC's signature filing requirement, and IASB's ED 1 on First-Time Application of IFRS.
12 August 2002: ED 1 on First-Time Application of IFRS can be downloaded
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The IASB exposure draft ED 1, First-time Application of International Financial Reporting Standards, is now available for downloading without charge. Comments are requested by 31 October 2002. Click for:
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8 August 2002: Statistics on globalisation of world's capital markets
The trend toward globalisation of the world's capital markets continues. We have updated our Statistics Page to reflect the latest cross-border listings reported by NYSE, NASDAQ, LSE, and the World Federation of Exchanges (50 exchanges).
7 August 2002: Updated comparison of IAS and South African GAAP
We have posted a new version of our comparison of IAS and South African GAAP updated through 24 June. Download it from our South Africa Page.
6 August 2002: Tajikistan will adopt International Accounting Standards
On 9 July 2002, the Prime Minister for the Republic of Tajikistan signed a Memorandum of Understanding with USAID that stipulates the Tajik Government will fully adopt IAS, both in form and content, as the official standards for all enterprises in Tajikistan. Implementation will begin in January 2003.
2 August 2002: NY Stock Exchange hesitates on accruing stock options
The New York Stock Exchange has adopted new rules requiring that a majority of the board members of listed companies be independent and that all stock option plans be approved by shareholders. The NYSE considered requiring listed companies to expense stock options but did not do so. At its July meeting, the IASB voted to develop an Exposure Draft of an IFRS that will require expense recognition.
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