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30 November 2004: IFRIC will meet on 2 December 2004

The International Financial Reporting Interpretations Committee will meet at the IASB's offices in London on Thursday, 2 December 2004. The agenda for the meeting is as follows:

29 November 2004: FEE guidance on pan-European prospectuses
The European Federation of Accountants (FEE) has published a discussion paper on Auditors' Involvement with the New EU Prospectus Directive. The Directive, which comes into force on 1 July 2005, is aimed at simplifying capital raising in Europe and is a key step in creating a single European market for financial services. The Directive requires involvement of the auditor to give assurance on historical and prospective financial information. FEE's paper provides national auditing standard setters with a framework within which standards might be developed to implement the requirements of the Directive. More information is on the FEE Website.

26 November 2004: IFRIC draft interpretation on waste equipment
The International Financial Reporting Interpretations Committee (IFRIC) has invited comments on draft interpretation IFRIC D10 Liabilities Arising from Participating in a Specific Market - Waste Electrical and Electronic Equipment. Comments are due by 11 February 2005. D10 clarifies when original producers of electrical goods will need to recognise a liability for the cost of waste management relating to final disposal of waste electrical and electronic equipment by private households. The IFRIC concluded that the event giving rise to the liability for costs of such waste is participation in the market in the period in which the original seller's market share is determined for the purposes of allocating ultimate waste management costs. It's not the original production or sale of the equipment that triggers liability recognition. Click for Press Release (PDF 24k).

26 November 2004: IFRIC Interpretation 2 on shares in co-ops
The International Financial Reporting Interpretations Committee (IFRIC) has issued Interpretation IFRIC 2 Members' Shares in Co-operative Entities and Similar Instruments (co-ops). Members- shares in co-ops have some characteristics of equity. They also give the holder the right to request redemption for cash, although that right may be subject to certain limitations. IFRIC 2 gives guidance on how those redemption terms should be evaluated in determining whether the shares should be classified as financial liabilities or as equity. Under IFRIC 2, shares for which the member has the right to request redemption are normally liabilities. However, they are equity if:

• the entity has an unconditional right to refuse redemption, or
  
• local law, regulation, or the entity's governing charter imposes prohibitions on redemption. But the mere existence of law, regulation, or charter provisions that would prohibit redemption only if conditions (such as liquidity constraints) are met, or are not met, does not result in members' shares being equity.
  

25 November 2004: FASB moves inventory standard toward IAS 2
The US Financial Accounting Standards Board has amended the US accounting standard on inventories to clarify that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognised as current-period charges and to require the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities. US GAAP still permits LIFO, which is no longer allowed under IAS 2. Click for FASB Press Release (PDF 24k). You can download FASB Statement 151 from the FASB Website.

25 November 2004: New Accounting Roundup posted
We've posted the 24 November Edition of Accounting Roundup (PDF 196k) published by Deloitte (USA). Topics covered in this issue include a proposed FSP on income taxes, recent FASB and AcSEC meetings, EITF developments, SEC postponement of accelerated of filing dates, PCAOB's amendments to its interim auditing standards, and international developments including amendment to the scope of SIC-12. You will find past issues of Accounting Roundup Here.

25 November 2004: Irish Institute welcomes endorsement of IAS 39
The Institute of Chartered Accountants in Ireland (ICAI) has welcomed the decision taken by European Commission to endorse an amended IAS 39 "as providing some clarity on the operation of the standard for now while recognising that this 'carved out' option should only have a short shelf life". Click for ICAI Media Release.

24 November 2004: PCAOB staff Q&As on internal controls
The US Public Company Accounting Oversight Board has published a third set of staff questions and answers related to PCAOB Auditing Standard No. 2, An Audit of Internal Control Over Financial Reporting Performed in Conjunction with an Audit of Financial Statements. AS 2 applies to audits of foreign, as well as domestic, SEC registrants. The new Q&As (nos. 30-36) address, among other things, audits of multinational companies that involve more than one auditor; audits of federally insured financial institutions; the timing of auditors' communications about weaknesses or deficiencies in internal control; audits of IT; and use of internal auditors.

• Q&A 30-36 (PDF 85k) published 22 November 2004
• Q&A 27-29 (PDF 58k) published 6 October 2004
• Q&A 1-26 (PDF 96k) published 23 June 2004

24 November 2004: BOE governor urges fresh look at IAS 39
In remarks delivered at the 13th Central Banking Conference in London on 22 November 2004, Sir Andrew Large, Deputy Governor of the Bank of England, said that "the recent furore over IAS 39 - the international accounting standard for financial instruments - has resulted in a situation which all agree is unsatisfactory". He called for a "re-examination of the basics aimed at securing agreement on fundamental principles" of financial instrument accounting. He raised questions about:

• "The ability to obtain robust fair values for instruments which are not priced, even indirectly, in reasonably deep and liquid markets."
• "The economic relevance of unrealised gains and losses - particularly if they are not immediately realisable."
• "Further concerns about wider use of fair value accounting relate to the possible implications for volatility in financial markets and in the economy more widely. In my view, there is an important distinction to be drawn between accounting rules which capture accurately the volatility inevitably present in the real world, and ‘spurious' volatility introduced by the accounting rules themselves."

23 November 2004: New working group on performance reporting

The IASB and FASB have jointly appointed a new working group on performance reporting to assist the boards in their joint project to establish standards for presenting, in the financial statements, information that is useful in assessing the financial performance of a business enterprise. Working group members include Stephen Taylor, a partner in Deloitte Touche Tohmatsu, Hong Kong. Click for Press Release (PDF 42k).

23 November 2004: Comments invited on proposed constitution revisions
The Trustees of the International Accounting Standards Committee Foundation (IASCF) have published and invited comment on a consultation document containing their proposals to amend the IASCF Constitution. The Constitution sets out the organisational framework of the IASCF and the International Accounting Standards Board. Comments are requested by 23 February 2005. Click to download the IASCF Press Release (PDF 28k). The consultation document can be viewed on the Foundation's website www.iascfoundation.org, and printed copies are available on request without charge. Among the principal recommendations are these:

23 November 2004: Three new IFRS e-learning modules are released

Deloitte is pleased to make available without charge three additional IFRS e-learning modules: IAS 24 Related Party Disclosures IAS 36 Impairment of Assets IFRS 2 Share-based Payment These modules bring the total number of available modules to 28. Each module involves a 4mb to 6mb download of a zip file, then installation via unzipping on your computer. Remaining modules planned for release by year-end are IAS 23, IAS 29, IAS 32/39 Parts 2 and 3, IAS 38, IFRS 3, and IFRS 5. To access Deloitte's IFRS e-learning, just click on the light bulb icon on the IASPlus home page.

22 November 2004: Decision summary for IFAC Council meeting
The Board and Council of the International Federation of Accountants (IFAC) met in Paris last week and took action on a range of issues, including these:

• Established a working group to identify initiatives that IFAC could undertake to enhance corporate governance and increase public confidence in capital markets. The group was asked to report to the Board in March 2005.
• Approved a Memorandum of Understanding with the United Nations Conference on Trade and Development to work more closely together in the areas of good governance, reliable accounting, and clear accountability to economic growth and social development. Early projects will focus on education and training programs and corporate governance.
• Approved a Memorandum of Understanding with the Institute of Internal Auditors to cooperate in such areas as corporate governance and the accountability of public sector organisations.
• Agreed to move ahead on recommendations in the recently issued report, Challenges and Successes in Implementing International Standards: Achieving Convergence to IFRSs and ISAs, giving particular attention to the needs of small and medium enterprises and practices.
• Accepted six new organizations as members of IFAC:
  • Association of Accountants and Auditors of Republic of Srpska (associate member)
  • Chamber of Financial Auditors of Romania (associate member)
  • Certified Public Accountants Association of Morocco (full member)
  • Estonian Auditing Board (full member)
  • Iranian Association of Certified Public Accountants (associate member)
  • National Institute of Accountants in Australia (full member)
• Elevated the Association of Professional Accountants and Auditors of the Republic of Moldova from associate member to full member of IFAC.

20 November 2004: European Commission endorses IAS 39
The European Commission has adopted a Regulation endorsing IAS 39 Financial Instruments: Recognition and Measurement, with the exception of certain provisions on the use of the full fair value option for liabilities and on hedge accounting. The Commission's announcement states that:

• EC Press Release (PDF 28k).
• A related document released by the European Commission: IAS 39 Financial Instruments: Recognition and Measurement – Frequently Asked Questions (PDF 85k).
• EC Declaration on Endorsement of IAS 39 (PDF 12k).

19 November 2004: Web-based technical update on IAS 12
The Deloitte London IFRS Centre of Excellence is running a monthly series of hour-long Internet-based IFRS technical updates, focusing on the most important international accounting standards and how they will affect UK companies. The seventh Webcast was run on 18 November 2004 and covered IAS 12 Income Taxes. To access the recording Click Here. The recording of each session will be available on this website for a period of at least 3 to 4 weeks from the date of the presentation. Links to past sessions may be found on our United Kingdom Page.

18 November 2004: Notes from day 2 of the November 2004 IASB meeting
To let our home page load faster, we have combined our notes of the IASB meeting on 16 and 17 November 2004 on a Separate Page.

17 November 2004: Notes from day 1 of the November 2004 IASB meeting
To let our home page load faster, we have combined our notes of the IASB meeting on 16 and 17 November 2004 on a Separate Page.

16 November 2004: IFAC ED on environmental management accounting
"To eliminate confusion and help clarify the definition, benefits, and applications of environmental management accounting (EMA)", the Board of the International Federation of Accountants has exposed for comment International Guidelines on Environmental Management Accounting. The exposure draft proposes guidelines for reporting environment-related information in financial and other reports. Click for IFAC's News Release. Comment deadline is 28 February 2005.

16 November 2004: Two new IVSC valuation standards

The International Valuation Standards Committee (IVSC) has 'preliminary final drafts' of two standards relating to valuation of fixed assets: International Valuation Application 1, Valuation for Financial Reporting; and International Valuation Guidance Note 8, The Cost Approach for Financial Reporting - (DRC) Click for IVSC News Alert describing the two proposals, which can be downloaded from IVSC's Website.

15 November 2004: Graham Ward is the new IFAC President
The Council of the International Federation of Accountants (IFAC) has elected Graham Ward, CBE, MA, FCA, as its new President for a two-year term concluding November 2006. IFAC represents 157 accountancy bodies from 118 countries and their 2.5 million member accountants. Click for IFAC Announcement.

15 November 2004: EFRAG comments on ED 7
The European Financial Reporting Advisory Group (EFRAG) has submitted its letter of comment to the IASB on ED 7 Financial Instruments: Disclosures (PDF 68k). There are links to all of EFRAG's letters of comment to the IASB on our EFRAG Page.

12 November 2004: IASB Chairman comments on the next phase
In an interview published in the Financial Times on 9 November 2004, IASB Chairman Sir David Tweedie warned that the next phase of the Board's standard-setting efforts is likely to be more challenging – and cause more anguish – than the recent debate over IAS 39 in Europe. As examples of projects that are likely to cause controversy, Sir David cited leasing, insurance, performance reporting, and pensions, all of which he expects the Board to complete over the next three to five years. "There will be blood all over the streets," the FT quotes the Chairman as saying, in reference to the expected reaction of some affected companies.

11 November 2004: IFRIC issues amendment to SIC 12
The IFRIC has amended the scope of Interpretation SIC 12 Consolidation–Special Purpose Entities to remove the scope exclusion for equity compensation plans. Consequently, an entity that controls an employee benefit trust (or similar entity) set up for the purposes of a share-based payment arrangement will be required to consolidate that trust. The new amendment also expands the scope exclusion in SIC-12 for post-employment benefit plans to include other long-term employee benefit plans. Click for Press Release (PDF 21k).

11 November 2004: Two new IFRIC members are named
The IASC Foundation has appointed two new IFRIC members: Michael E. Bradbury, Professor of Accounting, Unitec, New Zealand, and Jean-Louis Lebrun, Partner and Chairman of the Supervisory Board, Mazars, France. They will complete the remainder of the terms of two members who have recently retired from the IFRIC. They will be eligible for reappointment. Click for Press Release (PDF 19k). The Trustees also announced that Junichi Akiyama, Professor of Accounting, Tama University, Japan, will step down from the IFRIC for personal reasons no later than 30 June 2005. The Trustees will invite applications for his successor shortly. Click for Full List of IFRIC Members,

10 November 2004: Proposed changes to US market governance
The US Securities and Exchange Commission has proposed major changes to the systems of governance, transparency, oversight, and ownership of self-regulatory organisations (SROs), including stock exchanges, that operate the American securities markets. The Commission will also issue a concept release examining the effectiveness of self-regulation. Here are links to:

• SEC Press Release
• Remarks by SEC Chairman William H. Donaldson.

9 November 2004: EU proposed directive on company capital
As part of its programme to simplify European rules on company capital, the European Commission has proposed to allow companies to use information about fair values of assets as reported in financial statements in accounting for shares issued in exchange for non-cash assets. Currently, if non-cash assets are contributed to a corporation by investors in exchange for shares, EU law requires that the non-cash assets be valued by an outside expert. The proposed directive (law) would eliminate the requirement for outside expert valuation in several cases, including "where the value of the individual asset to be contributed upon proposal of the board is derived from audited accounts, provided that these have been established in accordance with the European Community's Accounting and Auditing provisions." Click for More Information on the EC Website.

8 November 2004: EFRAG seeks nominees for Technical Expert Group
The Supervisory Board of the European Financial Reporting Advisory Group (EFRAG) is seeking nominees for appointments to EFRAG's Technical Expert Group. Details are on EFRAG's Website.

8 November 2004: IFRIC project pages updated
We have updated our pages for the following IFRIC projects to reflect the discussions at IFRIC's meeting on 4-5 November 2004:

• D8 Members' Shares in Co-operative Entities
• IAS 17: Service Concession Arrangements
• IAS 32: Members' Shares in Co-operative Entities
• IAS 37: Obligating Event–Waste Electrical and Electronic Equipment
• IFRS 2: Changes in Employee Contributions to ESPP's
• IFRS 2: Treasury Shares and Group Transactions

7 November 2004: Notes from the second day of the IFRIC meeting
The International Financial Reporting Interpretations Committee (IFRIC) held a two-day meeting in London on 4-5 November 2004. Presented below are the preliminary and unofficial notes taken by the Deloitte observers at the second day of the meeting.

5 November 2004 D8 Members' Shares in Co-operative Entities Title On the issue of the title of the draft Interpretation, IFRIC agreed to a title that reads: "Members Shares in Co-operative Entities and Similar Instruments" so as to allow analogous reference as well as clear functioning of the hierarchy in IAS 8 but still making it obvious that the only issue dealt with specifically by IFRIC was that of members' shares in co-operative entities. Clarification of the application of the prohibition on redemption Certain constituents have raised concerns that the interpretation could have the unintended consequence of classifying certain members' accounts, when members' act as customers, as equity instead of liabilities. In particular UK building societies are subject to regulations ('nature limits') that require broadly that at least 50% of a society's borrowings are in the form of member share deposits. In all other respects, member share deposits behave as chequing accounts in a bank. However, application of D8 could inadvertently lead to the classification of such members' accounts as equity. To address this issue, IFRIC agreed with the Staff recommendation that the application of the prohibition on redemption be clarified by distinguishing between: conditional restrictions that prevent redemption only if a condition is met, and even then only until the condition is not met. These do not prevent a liability coming into existence and therefore do not lead to equity classification of members' shares, and unconditional restrictions that prevent redemption in all circumstances. These prevent a liability coming into existence and therefore lead to equity classification of members' shares; Staff brought to IFRIC's attention, suggestions by certain constituents to consider a concept of restrictions or prohibitions based on their permanence. IFRIC concurred with the Staff view that this would be difficult to achieve as this concept is not dealt with in IAS 32. Subsequent measurement of the liability for redemption of members' shares IFRIC agreed not to deal with this issue in the D8 project. Distinction between 'reclassification' and 'extinguishment' IFRIC agreed with the Staff recommendation to remove BC17 but to make other drafting changes to clarify this issue. Use of portfolio approach IFRIC discussed the concern raised by some commentators regarding the applicability of the portfolio approach and agreed to clarify by way of example, that the portfolio approach would be applicable. Transition IFRIC underscored its decision to retain the proposed effective date of 1 January 2005 after discussing some suggestions from commentators which included staggered implementation and deferral. It was re-affirmed that the co-operative groups had no problems with the proposed transitional requirements of D8. In conclusion, staff indicated that D8, subject to certain drafting changes, would be forwarded to IASB members for a final vote at the Board's December meeting. This summary is based on notes taken by observers at the IFRIC meeting and should not be regarded as an official or final summary. Scroll down for notes from 4 November 2004.

7 November 2004: Accounting for securities by banks
Speaking before the Securities Industry Association annual meeting, US Federal Reserve Board Governor Susan Schmidt Bies addressed a range of issues on accounting for securities in relation to the financial supervision of banks, including:

• Whether the sale of a security from the available-for-sale portfolio at a loss suggests that the remaining portfolio should be viewed as 'other than temporarily impaired', and therefore a loss should be recognised.
• Regulatory capital issues.
• Challenges in securities accounting and auditing from fair value measurements.

5 November 2004: Kevin Stevenson will leave the IASB

At the meeting of the International Financial Reporting Interpretations Committee yesterday, Kevin Stevenson announced that he will step down from his positions as IASB Director of Technical Activities and Chairman of IFRIC most likely by April 2005. Mr. Stevenson has served in those capacities since the inception of the IASB in 2001 and has led the staff in a productive programme of improvements to most of the old IASs, new IFRSs, Interpretations, and a substantial agenda of projects in process. Mr. Stevenson will return to his home country of Australia. [On 18 November 2004 IASB issued a Press Release (PDF 16k).]

5 November 2004: Notes from the first day of the IFRIC meeting
The International Financial Reporting Interpretations Committee (IFRIC) is holding a two-day meeting in London on 4-5 November 2004. Presented below are the preliminary and unofficial notes taken by the Deloitte observers at the first day of the meeting.

4 November 2004 Administrative Matters The Chairman announced that Junichi Akiyama would resign his membership of IFRIC as soon as a suitable replacement could be found. It was noted that in terms of vacancies on IFRIC the Trustees had made two offers of IFRIC positions and hoped to be able to announce new IFRIC members in December. The Chairman also referred to his own impending return to Australia, and indicated that he currently expects this to occur in April 2005. He noted that plans for a replacement chair are well advanced and a smooth transition in the new year is expected. Report of the Agenda Committee: Scope of IFRS 2 The Board discussed whether to develop an interpretation regarding the scope of IFRS 2, particularly whether or not where a share issue has taken place and the goods or services received in return are not immediately obvious, would such a transaction be considered within IFRS 2. It was noted that where special condition attach to the shares this would affect their fair value. The IFRIC agreed that prima facie, where no cash, or less cash than the fair value of the instruments is received the entity will have received other assets (whether recognisable under IFRS or not) equivalent in value to the cash shortfall. It was agreed that unless the other assets received are financial assets within the scope of IAS 32 and IAS 39, or arise from a business combination in accordance with IFRS 3, the transaction would be within the scope of IFRS 2. However, there was some unresolved debate, particularly around issues such as where shares are issued at a discount due to an urgent cash need. It was agreed that the distinction of when items should be accounted for in accordance with IFRS 2 is not immediately obvious in all cases and that IFRIC should issue an interpretation on this matter. The IFRIC agreed to discuss this matter in more detail at a future meeting. IFRS 2: Changes in Employee Contributions to ESPP's The IFRIC considered a draft interpretation on accounting for employee contributions to employee share purchase plans (such as the save-as-you-earn plans in the United Kingdom). The IFRIC agreed that where an employee ceases to participate in the savings plan and therefore loses the right to exercise options, there are two viable alternative treatments. The first is to treat this as a cancellation and to recognise the remaining expense to be recognised immediately, or the second to continue to recognise the expense over the previously determined vesting period. Two further alternatives of treating this as a vesting condition and therefore reversing all of the related expense, or to simply stop expensing without any reversal were discounted as being inconsistent with IFRS 2. The IFRIC agreed that as the entity is no longer receiving future service in respect of the employee's right to participate in the option scheme (which they have forfeited by lapsing their savings, and therefore are not taking this benefit into account in determining whether to provide future service) the cessation of saving should be treated as a cancellation under IFRS 2. The IFRIC agreed to proceed with a draft interpretation on this basis providing that a balanced view of alternative treatments was provided in the Basis for Conclusions. IFRS 2: Treasury Shares and Group Transactions The IFRIC considered a paper that contained a range of examples concerning the issues that arise when a subsidiary gives its employee benefits in the form of rights to purchase shares in its parent, and when an entity must purchase its own shares to satisfy IFRS 2 obligations. The IFRIC agreed that this issue should be taken onto its agenda, and that at this time the following issues should be considered: A single entity that voluntarily purchases its own shares to satisfy an obligation to issue shares A single entity that mandatorily purchases its own shares to satisfy an obligation to issue shares A group where the subsidiary grants share options over shares in the parent A group where the subsidiary grants share options over shares in the parent and the parent levies an inter-company charge A group where the subsidiary grants share options over shares in the parent which it buys shares on market to satisfy A group where the subsidiary grants share options over shares in the parent which it purchases shares from the parent to satisfy A group where the subsidiary grants cash benefits based on the market price of the parent company shares A group where employees are moved from entity to entity It was noted that the existence of minority interests would further complicate many of these issues. The IFRIC decided to consider all of these issues for interpretation, as many of the simpler issues must be concluded on as a building block to those requiring more in depth interpretation. However the IFRIC noted that in terms of final published interpretations it was possible some of these issues might be excluded and passed to the IASB education section. IAS 37: Waste Electrical and Electronic Equipment The IFRIC considered some editorial changes to this draft, and recommended that others be made. The staff undertook to complete these changes during the course of the meeting so that the draft could be formally voted on day two of the meeting. Activities of Other Interpretation Bodies The IFRIC heard a report of activities undertaken by other interpretation bodies in Australia, Canada, France and the United States. The IFRIC considered a number of the items under discussion by other bodies but did not wish to add any of them to its agenda at this time. Service Concession Arrangements The IFRIC considered issues raised by the financial instruments staff of the IASB in respect of the proposed draft interpretations. The IFRIC considered what situations across the following range of situations should be considered within the financial assets model Grantor pays - fixed payments Grantor pays - payments vary with demand Grantor retains demand risk - users pay but grantor guarantees amounts Grantor retains demand risk - operator collects revenues from users until it achieves a specified return Grantor regulates prices - designed to ensure operator receives specified return from users The proposal from the staff was that only the first two of these items should fall within the financial instruments model. The IFRIC agreed to expose this, but to include in the basis for conclusions a discussion of the possible merits of including the other items, and requesting comments on whether the IFRIC had drawn the distinction between the intangible asset model and the financial asset model in the correct manner. It was noted that a majority of IFRIC members supported exposing this proposal, but a majority do not necessarily agree that this is the most appropriate answer. The IFRIC also considered the limitation in IAS 39 that an item cannot be classified as a loan or receivable unless the entity is expected to recover substantially all of the amount , subject to any credit deterioration risk. It was noted that many service concessions arrangements would not meet this criteria and therefore could not be accounted for as a receivable. It was agreed that a discussion of this in the basis for conclusions was required (as the IFRIC had previously determined that an item could still be accounted for as a receivable if the only risk of non-recovery was related to future service issues - such as penalty clauses for non-availability of the asset), and that further consideration should be given to whether this highlights an inconsistency between IAS 11 and IAS 39. The IFRIC will consider a worked example of the service concessions models at a future meeting, but decided not to delay exposure of the proposals until this had been done. Accordingly this topic will be discussed at the December meeting with a view to issuing the draft interpretations for exposure. Publication of reasons for rejecting IFRIC agenda proposals The IFRIC considered the advantages and disadvantages of publishing the reasons why proposals put to the agenda committee were not accepted onto the agenda. Broadly, proposals are not accepted for one or more of three possible reasons: Inappropriate level (too narrow an issue) IFRS is considered by IFRIC to be clear Included within an existing Board or IFRIC project. The IFRIC considered the risk issues of such a list forming another part of GAAP, and the positive outcomes such as discouraging repeat requests to IFRIC and ease of dissemination. The IFRIC will further discuss this proposal at their closed session on day two of the meeting when the review of IFRIC operations is discussed. [Note: We maintain a List of Issues Not Added to IFRIC's Agenda.] This summary is based on notes taken by observers at the IFRIC meeting and should not be regarded as an official or final summary.

4 November 2004: Agenda for November 2004 IASB meeting
The IASB will meet at its offices in London on Tuesday and Wednesday 16-17 November 2004. The Board will not meet on Monday 15 November. The Board will also meet with the Standards Advisory Council at the Renaissance London Chancery Court Hotel on Thursday and Friday 18-19 November 2004. The agendas for the two meetings are below. You will find details of the IASB agenda Here.

4 November 2004: World Bank book on IFRSs
The World Bank has published International Financial Reporting Standards: A Practical Guide (Third Edition). Each chapter summarises an IFRS including problems addressed, scope, key concepts and definitions, accounting treatment, presentation and disclosure, and financial analysis and interpretation. Click for More Information.

4 November 2004: Statistics database updated
We have updated our Database of Statistics about the globalisation of the world's capital markets. That globalisation is an important reason why global financial reporting standards are needed.

3 November 2004: EC Internal Market newsletter discusses IFRSs
The Internal Market Directorate of the European Commission has published Issue No. 35 of Internal Market News, the Directorate's newsletter. An article on pages 6 and 7 titled The Wider Impact of IAS/IFRS provides background on the EU IAS Regulation and discusses why IAS 39 was adopted "with exceptions". Click to Download the Newsletter (PDF 1,298k).

3 November 2004: October 2004 IAS Plus newsletters

We have published the October 2004 editions of our quarterly IAS Plus newsletter in two versions: Global Edition (PDF 17 pages 249k) Asia-Pacific Edition (PDF 24 pages 303k) Both editions have the same news about international financial reporting, including updates on IASB projects and Board activities and news about IFRSs in Europe, the United States, and elsewhere in the world. Additionally, the Asia-Pacific edition has updates on accounting standard setting activity in seven countries in that region. You will find all past issues Here.

3 November 2004: Asia-Pacific jurisdiction pages updated
We have updated the following pages to reflect standard setting activity during the third quarter of 2004:

• Australia
• China
• Hong Kong
• Indonesia
• Malaysia
• Singapore
• Taiwan

3 November 2004: Four new IFRS e-learning modules now available

We are pleased to make available without charge four new modules in Deloitte's IFRS e-learning series: IAS 23 Borrowing Costs IAS 29 Financial Reporting in Hyperinflationary Economies IAS 38 Intangible Assets IFRS 3 Business Combinations This brings the number of available modules to 28. All of the remaining modules (namely IASs 24, 32/39 Parts 2 and 3, and 36, and IFRSs 2 and 5) are scheduled for release before the end of the year. You can always access Deloitte's IFRS e-learning by clicking on the light bulb icon on the IASPlus home page.

3 November 2004: Shortcomings in corporate monitoring and reporting

Only about one-third of 250 board members and top executives of large companies polled worldwide in a new Deloitte-sponsored survey say their companies are proficient at monitoring critical non-financial indicators of corporate performance. By contrast, 86% of executives believe their companies are excellent or good at measuring and tracking the performance indicators necessary for financial reporting purposes. The survey is titled In the Dark: What Boards and Executives Don't Know about the Health of Their Businesses: Press Release (PDF 33k) Link to More Info and Download the Survey Report

2 November 2004: ARC to consider endorsing additional IFRSs
The Accounting Regulatory Committee of the European Commission will meet in Brussels on 30 November 2004 to vote on recommendations to endorse certain new and improved IFRSs and IFRIC 1. The specific IFRSs to be considered are IASs 1, 2, 8, 10, 16, 17, 21, 24, 27, 28, 31, 32, 33, 36, 38, and 40, as well as IFRSs 2, 3, 4, and 5. The agenda also includes a Commission presentation on "the latest developments towards a solution on the fair value option and on the technical work on the interest margin hedge" (IAS 39). Click to download:

• ARC Meeting Agenda (PDF 15k)
• Improved IASs and Related Regulations (ZIP 948k, 17 files, not including IFRSs 2-5 or IASs 32, 36, 38)

2 November 2004: Framework for evaluating internal control deficiencies
Nine large accounting firms, including Deloitte, have jointly issued A Framework for Evaluating Process/Transaction-Level Exceptions and Deficiencies for use in implementing Section 404 of the Sarbanes-Oxley Act. While the framework is not endorsed by the Public Company Accounting Oversight Board (PCAOB), and it should be read in conjunction with PCAOB Auditing Standard No. 2 on internal control audits, companies may find it a useful reference as they implement the requirements of Section 404. Click to Download the Framework (PDF 80k).

2 November 2004: New FEE paper on auditor independence
The European Federation of Accountants (FEE) has published a 186-page paper outlining how to apply, in practice, the principles underlying the European Commission's Recommendation on auditor independence. The EC Recommendation requires auditors to identify, consider, and document potential threats to their independence and to detail the safeguards that have been put in place to eliminate those threats. The FEE publication also provides a comparison of the requirements of the EC Recommendation with that of the independence section of the International Federation of Accountants (IFAC) Code of Ethics. Click to:

• FEE Press Release (PDF 24k).
• Link to FEE Website where the publication may be downloaded without charge (click on 'ethics', free registration is required).

2 November 2004: New Accounting Roundup newsletter
The 1 November Edition of Accounting Roundup (PDF 250k) is now available. This newsletter is published by Deloitte (USA) and includes the latest news from FASB, GASB, SEC, PCAOB, AICPA, IASB, and IFRIC. You will find past issues of Accounting Roundup Here.

2 November 2004: New Global Offerings Services newsletter

We have posted the October 2004 Global Offerings Services (GOS) Newsletter (PDF 283k), which provides US reporting information for non-US based companies. This issue covers recent EITF, SEC, and PCAOB activities and announces the availability of a US GAAP Compliance Checklist. There are also links to 15 recent Deloitte publications. You will find past issues of the GOS Newsletter Here.

2 November 2004: Heads Up on unremitted foreign earnings

The latest edition of the Heads Up Newsletter (PDF 103k) from Deloitte (USA) is of interest globally. It is devoted to the American Jobs Creation Act of 2004, the first major broad-based restructuring of US business taxes since 1986. The Act gives multinational companies a limited, one-time tax incentive to repatriate up to 85% of their foreign earnings tax-free. Accounting implications may include: A need to recognise deferred tax and tax expense in 2004 on the planned repatriation in 2005. For companies that have provided deferred taxes on unremitted earnings, consideration of the 85% deduction likely will reduce the deferred tax liability. The timing of recognising tax expense or benefit could be complicated by the Act's requirements to have specific plans for reinvesting the undistributed earnings.

1 November 2004: Russia moves toward adopting IFRSs
IFRSs moved a step closer in Russia last week when the Duma (parliament) gave preliminary approval to a bill requiring corporations with more than one subsidiary to publish financial statements that conform to International Financial Reporting Standards within six months of the end of their financial year. All companies will still have to report unconsolidated results to Russian standards. Two additional votes of the Duma are required before the bill would become law. The bill as passed calls for companies to report under IFRSs as of 2004. It may be changed to a 2005 effective date before final adoption. Some large Russian companies already report under IFRSs. Others currently use US GAAP. The US GAAP companies will have until 2008 to switch to IFRSs.