|
31 October 2004: UK FSA letter to CEOs on IFRSs
The UK Financial Services Authority has written to the CEOs of all listed companies reminding them of the need for disclosure of their application of IAS 39 (particularly if they elect to follow the EC version with two 'carve-outs') and stating that FSA will allow listed companies 120 days, rather than the normal 90 days, to prepare their first half-yearly accounts under IFRSs. Click to Download the FSA Letter (PDF 195k).
31 October 2004: UK adjustments to IFRSs for regulatory capital
The UK Financial Services Authority has published a consultation paper proposing four adjustments to capital as measured under IFRSs for the purpose of measuring "prudential regulatory capital" in the financial services industry. FSA Press Release (PDF 54k, contains link to consultation paper and a related newsletter):
- In the treatment of cash-flow hedges, we propose to eliminate from the measurement of regulatory capital all fair value gains and losses arising from the fair valuation of derivatives that have been accumulated in equity;
- In the treatment of available-for-sale assets we propose to follow the US approach and to leave equities at fair value, but write available-for-sale debt instruments back to cost or amortised cost;
- For fair value options we propose that unrealised gains or losses arising from the fair valuation of a firm's own credit risk should be eliminated from regulatory capital; and
- In accounting for defined benefit pension schemes we propose that the accounting measure of actuarial losses should be eliminated for regulatory purposes. It should be replaced by the company's best estimate of the level of additional funding that it will need to provide for its pension scheme over the next five years.
30 October 2004: A global 'shareholder society'
In his recent Remarks before the International Organization of Securities Commissions, US SEC Chairman William H. Donaldson highlighted the importance of providing credible financial information in all of the world's public capital markets:
|
The work we are doing on U.S. markets, and the work all of you are doing in your markets, is part and parcel of a broader issue: the movement of millions of people throughout the world into what has been called 'the shareholder society.' While share ownership has historically been limited to the wealthier nations of the world, today it can be found in all corners of the globe. More than 13 million households in India are directly invested in debt or equity shares, based on the most recent statistics. And there are believed to be approximately 36 million active equity investors in China. |
30 October 2004: Near-final drafts of two pronouncements are posted
The IASB has posted "near-final drafts" of the IFRIC Amendment to SIC-12 (to include equity compensation plans) and of IFRS 6 (Exploration for and Evaluation of Mineral Resources) in the subscriber area of the IASB Website. These will be publicly available in the next several days.
29 October 2004: Agenda for IFRIC's November 2004 meeting
The International Financial Reporting Interpretations Committee (IFRIC) will meet at the IASB's offices in London for two days: 4 and 5 November 2004. Presented below is the agenda for the meeting.
Agenda, IFRIC Meeting, 4-5 November 2004, London
Thursday 4 November 2004
- Scope of IFRS 2
- IFRS 2 - Changes in Employee Contributions to ESPPs
- IFRS 2 Treasury Share Transactions and Group Transactions
- Report of Agenda Committee and Activities of Other Interpretation Bodies
- Accounting for Service Concessions – The IFRIC will re-debate two matters on which it reached tentative conclusions at previous meetings:
- the circumstances in which the operator has a financial (as opposed to intangible) asset; and
- the circumstances in which a financial asset cannot be classified as a loan or receivable.
- Publication of Reasons for Rejecting IFRIC Proposals
Friday 5 November 2004 (Morning Only)
|
29 October 2004: Proposed amendments to 4th and 7th Directives
The European Commission has proposed certain corporate governance amendments to Council Directives 78/660/EEC and 83/349/EEC (the Fourth and Seventh Directives) concerning the annual accounts of certain types of companies and consolidated accounts. Objectives of the revisions are to establish the collective responsibility of board members for a company's financial statements and annual reports; enhance transparency about related party transactions (companies' transaction with their managers, managers' family members, and others); expand disclosures about off-balance arrangements (including commitments and special purpose entities); and introduce a corporate governance statement. Click to download:
Other language versions can be found on the EC Website.
28 October 2004: All Bulgarian companies must use IFRSs starting 2005
As of 1 January 2003, all listed companies, banks, insurance companies, and pension funds in Bulgaria were required to use International Financial Reporting Standards. Other companies had the option of applying IFRSs or continuing to use Bulgarian GAAP. Starting in 2005, the other companies will be required to switch to IFRSs. The Bulgarian Ministry of Finance is developing a Bulgarian translation of IFRSs.
28 October 2004: All banks in Kazakhstan must use IFRSs
For several years, banks in Kazakhstan that chose to participate in that country's deposit insurance fund have been required to prepare financial statements using IFRSs as well as Kazakh reporting standards. Starting in 2004, all banks are required to participate in the deposit insurance programme. Therefore, all Kazakh banks will prepare IFRS financial statements for 2004. Click to go to our Table of Country Use of IFRSs.
28 October 2004: IASC Foundation reappoints three trustees
The Trustees of the International Accounting Standards Committee Foundation have reappointed three of the Trustees, effective 1 January 2005, to additional three year terms ending 31 December 2007. The three are Malcolm Knight, general manager, Bank for International Settlements; Jens Roder, partner, PricewaterhouseCoopers, Denmark; and Roberto Teixeira da Costa, chairman, Brazilian Securities and Exchange Commission. The Trustees have also announced that John Biggs, Guido Ferrarini, and Koji Tajika will retire as Trustees when their terms expire on 31 December 2004. A search has started for candidates to fill the vacancies. Click for:
27 October 2004: PCAOB proposes $153 million budget for 2005
The US Public Company Accounting Oversight Board has approved a budget of $152.8 million for 2005. The PCAOB oversees the auditors of public companies, including auditors of foreign companies registered with the SEC, to protect the interests of investors and further the public interest in the preparation of informative, fair, and independent audit reports. The 2005 budget, which must be approved by the Securities and Exchange Commission, provides for a 50% increase in staffing, from approximately 300 expected by the end of 2004 to approximately 450 by the end of 2005. The increase will primarily add experienced auditors to conduct inspections of the registered public accounting firms that audit the financial statements of SEC registrants. At 25 October 2004, there were 1,369 registered public accounting firms, of which 850 have at least one public company audit client. Click for More Information.
27 October 2004: Report from the IASCF Trustees' meeting
The trustees of the IASC Foundation met in London on 25 October 2004. Presented below are the preliminary and unofficial notes taken by Deloitte observers at the meeting. Key decisions include:
- increasing the IASCF trustees from 19 to 22;
- retaining the current provision for two part-time IASB members;
- giving trustees the right to comment on and make suggestions about the IASB's agenda, but not authority to decide the agenda;
and
- increasing the vote for EDs, Standards, and Interpretations from a simple majority to 9 out of 14 IASB members.
| IASCF Trustees' Meeting, 25 October 2004, London
|
|---|
|
Constitution Review
To start off the discussion of the broader issues related to the review of the IASCF constitution, the chairman gave an overview of the process by highlighting some of the more significant issues that were later dealt with during the detailed deliberations. The chairman pointed out that on the whole, the current constitution was viewed as providing a sound basis on which its operations and those of the IASB are based. The major areas that commentators had identified for further development were:
- The perception that the trustees had not carried out adequately their oversight role; and
- That the IASB did not appear to be "listening" to the concerns raised by European constituents.
Related to the latter issue, one trustee said that this misperception should be dealt with by better communication of the IASB's role, which is not to serve preparers only, but to serve investors and the global capital markets at large. In addition, many commentators had underscored the need for the IASB to remain independent. In response to certain groups that wanted to have influence, another trustee pointed out that it is not a role of the IASB to assist the business community to achieve certain accounting results.
The point was also made, that generally, the trustees should only look to change the constitution with good reason, and not merely due to outside pressure, whilst seeking to maintain a balance between remaining independent but avoiding isolation.
The trustees next discussed the preliminary recommendations of the Constitution Committee. The objective of this discussion was to reach tentative views (the chairman stressed that these decisions were not final) on the issues presented, after which, a paper would be exposed for comment, with appropriate highlights of the more controversial issues on which the trustees would seek feedback. The paper to be exposed will indicate the reasons why the trustees made certain decisions and rejected certain arguments.
Considerable time was spent discussing the proposed drafting of the amendments to the constitution, with certain issues still to be worked on prior to exposure of the paper. Therefore, the quoted paragraphs below may be subject to additional changes.
The comment period for this paper would be in line with the trustees' intention to make the final decisions at the March 2005 meeting.
Topic 1 - Whether the objectives of the IASC Foundation should expressly refer to the challenges facing small and medium-sized entities (SMEs)
After some discussion, and acknowledging that the IASB should be able to exercise its discretion regarding SMEs and emerging economies, the trustees agreed to modify section 2(b) of the constitution in order to make special mention of these two groups as follows:
"(b) to promote the use and rigorous application of those standards, taking account of, as appropriate, the special needs of small and medium-sized entities and emerging economies; and… "
Topic 2 - Number of trustees and their geographical and professional distribution
The trustees agreed to changing the term "Asia/Pacific" to "Asia/Oceania" to make clear that North and South American countries on the Pacific Ocean are not intended to be treated as part of this grouping.
In addition to certain editorial amendments to paragraphs in the constitution relevant to this topic, it was agreed to increase the number of trustees to 22 (from 19), as follows:
- 6 Trustees appointed from North America;
- 6 Trustees appointed from Europe;
- 6 Trustees appointed from the Asia/Oceania region; and
- 4 Trustees appointed from any
other area, subject to establishing overall geographical balance.
Regarding the fourth bullet point above, the Trustees agreed to delete the word "other" so as to provide flexibility in appointing the four trustees referred to therein. This would clarify that candidates would not necessary have to be appointed from a region other than North America, Europe, and Asia/Oceania (for example Latin America or Africa). However, there was general agreement that the trustees would document in the basis for their conclusions that despite not being explicitly mentioned, normally a trustee would be appointed from Latin America and Africa.
The question of allowing a future chairman, if appointed from the existing group of trustees, to serve beyond six years was raised. It was agreed to allow a chairman to serve up to, but no more than, six years in that role, from the date of appointment as chairman. To provide for this, it was agreed to amend Section 11 in the following manner (with any such change affecting the position of the chairman effective for the next chairman appointed):
"11. The Chairman of the Trustees shall be appointed by the Trustees from among their own number. With the agreement of the Trustees, the appointee may serve as the Chairman for a period of up to six years."
The trustees agreed that the IFAC nominations should be retained, but reduced to 2 nominees (from 5).
Topic 3 - The oversight role of the trustees
This topic was discussed at length, in particular, the drafting of the constitution in Section 16(c), which the trustees agreed should be worded as follows:
"16. In addition to the duties set out in Part A, the Trustees shall:
... (c) review annually the strategy of the IASC Foundation and the IASB and its effectiveness, including consideration and comment, but not to determine or decide, the IASB's agenda;
…"
Much of the trustees' discussion centred on the meaning of the word "consideration", which some trustees believed could be interpreted to mean that the trustees had the authority to approve or disapprove the IASB's agenda. The above wording together with the wording of Section 32(c), which shall state the following, was considered sufficiently clear in terms of the trustees' intentions, which would allow the IASB the autonomy to determine its own technical agenda while leaving the trustees with the ability to comment and suggest as appropriate:
"32 The IASB shall:
(c) have full discretion over in developing and pursuing the technical agenda of the IASB …."
Topic 4 - Funding of the IASC Foundation
Consistent with the trustees' responsibility for the organisation's finances, there was agreement to change the language in Section 14(a) as follows.
"14 The Trustees shall:
(a) assume responsibility for fundraising satisfy themselves that appropriate financing arrangements are in place."
Topic 5 - The Composition of the IASB
The trustees agreed to leave the number of Board members at 14 after consideration of all the activities they undertake, which include considerable liaison roles in addition to preparation and attendance at meetings.
The composition of the Board by full-time and part-time members was discussed at length. The advantages of retaining part-time members includes the maintenance of practical experience within the IASB as well as providing some flexibility which encourages potential candidates who might have a strong preference for either a full-time or part-time position, to apply for vacancies. However, the Trustees were mindful that expanding the number of part-time members beyond four might raise questions about conflicts of interest and independence as well as the fact that it had proved difficult in the past, to fill these positions particularly with part-time members that are preparers.
The chairman of the IASB made the point that the current part-time members had performed very well, despite the obvious pressures and constraints that they face.
The trustees agreed to retain the limitation of 2 part-time members of the Board.
The point was made that analysts, who make up an important user group of IFRS financial statements, have proven very difficult to attract onto the Board.
Topic 6 - The appropriateness of the IASB's existing formal liaison relationships
The trustees discussed and agreed on editorial amendments that remove the restrictive wording in Section 23 of the constitution regarding the number of full-time Board members that will have liaison responsibilities without narrowly specifying with whom they will liaison.
Topic 7 - Consultative arrangements of the IASB
In addition to the change to Section 32(c) as noted above (see Topic 3), the trustees agreed to simplify the paragraph as whole by listing the mandatory steps separate from the optional steps as some trustees had a concerns about the wording in Section 32(d)(ii), (iii) and (iv) in particular.
The trustees agreed to require that the Board explain its reasons when the optional steps are not followed.
Topic 8 - Voting procedures of the IASB
After considering the pros and cons set out by commentators and the constitutional committee, of adopting a simple majority or super majority voting system, the trustees agreed to require that an ED, IFRS, or Interpretation be approved by 9 votes out of 14. Other decisions shall require a simple majority.
Topic 9 - Resources and effectiveness of the IFRIC
Because of the public's interest in the functioning of the IFRIC, the Constitution Committee or the trustees plan to provide some public update on the issues being discussed as part of the review of the IFRIC's operations.
Topic 10 - The composition, role, and effectiveness of the SAC
The trustees agreed with the suggestion that the SAC and the IASB should have separate chairs. Most comments also welcomed regular liaison between the trustees and the SAC as mentioned in the possible approach. The trustees therefore considered the following changes to Section 39 of the constitution:
"39. The Council shall comprise thirty or more members, having a diversity of geographical and professional backgrounds, appointed for renewable terms of three years. The Chairman of the IASB shall chair the Council. The Chairman of the Council shall be appointed by the Trustees, and shall not be a member of the IASB or a member of its staff. The Trustees may invite the Chairman of the Council to attend the Trustees' meetings, as appropriate."
IASB Chairman's Report
The IASB Chairman presented his report in which he gave an overview of the status of major projects currently on the IASB and IFRIC agendas as well as other activities. Specific mention was made of the following:
- Convergence: The Board is targeting the year 2007 as the milestone at which there will no longer be a reconciliation required between IFRS financial statements to US GAAP. The Board's strategy has been to tackle the major areas of difference between the two accounting regimes which to date has led to the joint project on Business Combinations and now, Income Taxes. The IASB Chairman stressed the point that despite the scepticism about the 2007 target, the IASB, FASB and SEC have been working together to try and meet this goal. The point was made that the SEC has been "pushing hard" to ensure that there is convergence within this timeframe.
- Insurance contracts: The IASB is leading on this project by exploring accounting practices around the world with a view to the FASB adopting the work done at a later stage.
- Adoption of IAS 39 in Europe: The Board is considering alternatives by working with regulators, banks and financial instruments experts to try and resolve the concerns that have led to the "carve-outs". When asked about the issue of how IFRS 1 impacts those entities that do not adopt full IFRS, the point was made that IFRS 1 is clear on how it should be applied as it was designed specifically to counteract such circumstances.
- IFRIC's project on Service Concessions: Draft interpretation will be ready for exposure shortly. The IASB Chairman made the point that this project had taken a substantial amount of time due to the complexity of the issues which may, in hindsight, have required a Standard to be developed by the IASB, not an Interpretation by IFRIC.
- Feedback from the recent meeting with national standard setters: The Vice Chairman of the IASB will be visiting India, China, and Japan shortly. The Accounting Standards Board of Japan (ASBJ), which has recently formalised its convergence plans with the IASB, is in the process of analysing the differences between its Standards and IFRS. Current plans are for some IASB members to meet with ASBJ in March 2005 to discuss these difference with a view to converging the two sets of standards.
Education Update
Certain educational products will be issued in the last quarter of 2004:
- A disclosure checklist that the IASB has been working on with Ernst & Young.
- Web based education material which has taken some time to prepare due to delays with technology development. This material will cover major topic areas such as Business Combinations and financial instruments accounting ("non-complex" areas).
The point was made that educational material will be for sale, the terms and logistics of which are still being finalised.
Regarding the above, all material will first be released in English although there are plans to translate this material into Spanish and French at a later date. This education material will not be considered as opinions of the IASB but merely guidance prepared by the Staff to assist in the application of IFRS.
Sometime in the coming year, education material covering presentation of financial statements will be released.
This summary is based on notes taken by observers at the IASC Foundation Trustees' meeting and should not be regarded as an official or final summary.
|
27 October 2004: EFRAG is seeking a technical director
The European Financial Reporting Advisory Group is seeking a full-time technical director who will be based in Brussels and report directly to the chairman. Application deadline is 10 November 2004. You can get more information on the EFRAG Website.
26 October 2004: Agenda project pages are updated
We have updated the following agenda project pages to reflect the discussions and decisions at the IASB's October 2004 Board meeting:
25 October 2004: Comment letters on IAS 39 EDs
The IASB has posted on its website the comment letters it has received on three exposure drafts of proposed amendments to IAS 39:
- Cash Flow Hedge Accounting of Forecast Intragroup Transactions,
- Financial Guarantee Contracts and Credit Insurance, and
- Transition and Initial Recognition of Financial Assets and Financial Liabilities.
Click to Download the Letters from IASB's website.
25 October 2004: IOSCO will host financial reporting conference in NYC
The International Organization of Securities Commissions (IOSCO) will host a conference on 27-29 October 2004 in New York to discuss emerging international issues concerning the regulation of global securities markets. Programme sessions include
- The Future of Self-Regulation
- The Role and Operation of Stock Exchanges in the 21st Century
- Cross-Border Oversight of Auditors
- The Rights of Shareholders in a Global Capital Market
- Issues in a Global Capital Market
- Cross Border Enforcement
- Impacts of Evolving Technology on the conduct of Securities Business and Regulation
- Single Regulators V. Functional Regulators and Federal V. State Regulation
Click for Details (PDF 127k).
24 October 2004: New European Corporate Governance Forum
The European Commission has created a European Corporate Governance Forum to examine best practices in Member States with a view to enhancing the convergence of national corporate governance codes and providing advice to the Commission. The Forum's 15 members come from various professional backgrounds (issuers, investors, academics, regulators, and auditors) and are appointed for three-year terms. The Forum will meet two to three times a year and will deliver a yearly report to the Commission. Click for Press Release (28k).
23 October 2004: Proposals to change IASC Foundation constitution
The Constitution Committee of the IASC Foundation Trustees will present its preliminary recommendations on changes to the Foundation's constitution at a meeting of the Trustees on 25 October 2004. If the Trustees approve the recommendations, they will be published for public comment. Click to Download the Proposals of the Constitution Committee (PDF 275k). Among the recommendations:
Recommendations of the Constitution Committee
IASB:
- Permit up to four part-time members of the IASB (currently it is two).
- Broaden the criteria for selecting IASB members – 'professional competence and practical experience' would replace 'technical expertise'.
- The required mix of backgrounds on the IASB would be less restrictive. Currently a minimum of five practising auditors, three preparers, three users, and one academician are required. That would be changed to "an appropriate mix of practical experience among auditors, preparers, users, and academics", including at least one IASB member who has recent experience in each of those fields.
- Require nine votes (64%) by IASB members to approve an Exposure Draft, Standard, or Interpretation, rather than the current eight (57%).
- Enhance the IASB's due process by expanding its consultative arrangements and scope of liaison activities.
Trustees:
- Expand the number of Trustees from 19 to 22 to broaden geographical representation and diversity of professional experience.
- Allow the Chair of the IASC Foundation Trustees to serve as Chair for six years, even if that period is beyond the limit of two three-year terms for Trustees.
- The Trustees' annual review of the strategy and effectiveness of the Foundation and the IASB and its effectiveness should include consideration of the IASB's agenda.
- Rather than necessarily developing educational programmes itself, the Foundation should foster and review the development of educational programmes and materials by others.
Standards Advisory Council:
- The Chair of the Standards Advisory Council would be appointed by the Trustees (three-year term, one renewal permitted) and would not be a member of the IASB or its staff (currently the IASB Chair also chairs the SAC).
|
23 October 2004: Deloitte comment letter on ED 7
We have posted the Deloitte letter of comment on the IASB's exposure draft ED 7 Financial Instruments: Disclosures. Click to Download the Deloitte Letter (PDF 99k). Our overall view:
|
We support the issuance of a new Standard that contains all disclosure requirements in relation
to financial instruments of any entity. We believe the issuance of such a standard will enhance
comparability of financial reports, and ensure consistent disclosures in relation to financial
instruments, particularly by entities whose primary operations are not in financial services
sectors. |
22 October 2004: Web-based technical update on IAS 1 and IAS 14
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 sixth Webcast was run on 20 October 2004 and covered IAS 1 Presentation of Financial Statements and IAS 14 Segment Reporting. 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.
21 October 2004: Equivalence of national GAAPs and IFRSs
The Committee of European Securities Regulators (CESR) has published a Concept Paper on Equivalence of Certain Third Country GAAP and on Description of Certain Third Countries' Mechanisms for Enforcement of Financial Information. CESR developed the paper in response to a request from the European Commission for advice on equivalence of Canadian, Japanese, and United States GAAPs with IFRSs. The EC also asked CESR to describe the mechanisms existing in those countries and others for the enforcement of standards for financial information. The concept paper sets out the basis on which CESR will approach its analysis. Click to Download the CESR Concept Paper (PDF 289k). CESR has requested comments on its concept paper by 22 December 2004.
21 October 2004: Notes from the third day of the IASB meeting
We have combined all of our preliminary and unofficial notes from the 18-20 October 2004 IASB meeting onto a Single Page.
20 October 2004: Minutes of 1 October 2004 ARC meeting
The European Commission has published the minutes of the 1 October 2004 meeting of its Accounting Regulatory Committee at which the ARC recommended endorsement of IAS 39 for use in Europe with two sections "carved out": The carve-outs would (1) prohibit use of the IAS 39 fair value option as it applies to liabilities, and (2) allow using fair value hedge accounting for interest rate hedges of core deposits on a portfolio basis. Click to Download the ARC Minutes (PDF 34k). The recommendation awaits final approval by the 25-member European Commission.
20 October 2004: Notes from the second day of the IASB meeting
We have combined all of our preliminary and unofficial notes from the 18-20 October 2004 IASB meeting onto a Single Page.
20 October 2004: IASC Foundation is seeking three trustees
The IASC Foundation is seeking three new members of its board of trustees – one each from the Asia-Pacific region, Europe, and North America. One should have senior experience in accounting, and another must have a background in the user community, which could include senior experience in investment organisations, regulatory bodies, or analyst institutions. The appointments will be for the three years expiring on 31 December 2007, with one renewal possible. Click for More Information (PDF 14k).
20 October 2004: EFRAG letter on IAS 39 amendments
The European Financial Reporting Advisory Group has submitted its written comments to IASB on the exposure draft of Proposed Amendments to IAS 39 – Cash Flow Hedge Accounting of Forecast Intragroup Transactions (PDF 48k).
20 October 2004: 100,000 e-learning downloads from IASPlus
|
Yesterday the 100,000th IFRS e-learning module was downloaded from IASPlus since Deloitte's e-learning was launched at the end of January. Many of those modules have multiple users because organisations are permitted to install the Deloitte IFRS e-learning modules on their own servers for the internal use of their employees or students. In addition, tens of thousands of modules have been completed online and offline by Deloitte staff. You can always access IFRS e-learning without charge by clicking on the light bulb icon on the IASPlus home page. |
19 October 2004: FASAC members comment on convergence
The US Financial Accounting Standards Board has posted on its website the findings of its annual survey of members of the Financial Accounting Standards Advisory Council. One interesting finding is that "FASAC members generally would not automatically assign a higher priority to projects that provide international convergence opportunities. Nor do they believe that the Board should always add a project to its agenda because the IASB does". Click to view or download the report of the Annual FASAC Survey.
19 October 2004: Notes from first day of October 2004 IASB meeting
We have combined all of our preliminary and unofficial notes from the 18-20 October 2004 IASB meeting onto a Single Page.
18 October 2004: New SEC staff appointee to focus on international issues
The US Securities and Exchange Commission has announced the appointment of Julie A. Erhardt as Deputy Chief Accountant responsible for international issues, reporting to Donald T. Nicolaisen, Chief Accountant. Ms. Erhardt will work closely with various international organisations including the IASB and IFAC on issues relating to convergence of accounting, auditing, and reporting standards. She spent seven months on an interim assignment with the IASB and also served a two-year fellowship at the FASB. Click for SEC News Release.
15 October 2004: SEC Chief Accountant comments on IFRS reconciliation
In his remarks at the IASB meeting with world standard setters on 28 September 2004, US SEC Chief Accountant Donald T. Nicolaisen commented on IASB-FASB convergence activities and the possibility of eliminating the SEC's requirement that foreign registrants using IFRS also submit a reconciliation of earnings and equity to US GAAP. Click to download Mr. Nicolaisen's Remarks (PDF 53k). An excerpt:
|
My personal view is that if things continue as they have been going - if the IASB operates as a strong independent standard-setter and continues to develop and issue high quality standards, if the commitment to quality application of IFRS remains, and if good progress is made in accounting convergence and the development of an effective global financial reporting infrastructure - then I believe that the SEC will be able to eliminate our reconciliation requirements. I assure you that I am eager to embrace IFRS because I believe our investors in the U.S. will benefit.
|
15 October 2004: EFRAG comment letter on SMEs
The European Financial Reporting Advisory Group (EFRAG) has submitted its Letter of Comment to the IASB on the IASB's Discussion Paper Preliminary Views on Accounting Standards for Small and Medium-sized Entities (PDF 103k).
15 October 2004: New Accounting Roundup quarterly edition
We have posted Accounting Roundup: 3rd Quarter 2004 in Review (PDF 1,500k). This is the quarterly edition that summarises selected recent accounting and financial reporting developments at FASB, EITF, GASB, AICPA, SEC, PCAOB, IASB, and IFRIC. The articles included in this edition were drawn primarily from issues of Accounting Roundup from Deloitte & Touche (USA) published in the third quarter of 2004, and have been updated where appropriate. Past issues are Here.
14 October 2004: FASB agrees to delay its stock options standard
The US Financial Accounting Standards Board has voted to delay the effective date of its proposed standard on accounting for equity-based compensation by six months – to interim or annual periods beginning after 15 June 2005. Therefore, an entity would apply the final statement to all employee awards of share-based payment granted, modified, or settled in any interim or annual period beginning after 15 June 2005. FASB's exposure draft would require recognition of an expense for all equity-based compensation, including stock options. The proposal, as modified as a result of consideration of comments received, is similar though not identical to IFRS 2 Share-based Payment, which is effective for financial years beginning on or after 1 January 2005, with earlier application encouraged.
14 October 2004: Reminder – comment deadline on ED 7 is next week
 |
The deadline for comments on Exposure Draft 7: Financial Instruments: Disclosures is Friday, 22 October 2004. ED 7 would:
- add certain new disclosures about financial instruments to those currently required by IAS 32,
- replace the disclosures now required by IAS 30, and
- put all of those financial instruments disclosures together in a new standard on Financial Instruments: Disclosures. IAS 32 would then deal only with financial instruments presentation matters.
|
13 October 2004: ARC opinion on IAS 39
We have inserted a link to the official report of the decisions of the EU Accounting Regulatory Committee on endorsement of IAS 39 into our 4 October 2004 News Story about the ARC meeting.
13 October 2004: New EITF Roundup is available
We have posted the September 2004 Edition of EITF Roundup (PDF 117k), which provides an overview of the issues discussed, consensuses reached, and administrative matters discussed at the 29-30 September 2004 meeting of FASB's Emerging Issues Task Force. EITF Roundup, from Deloitte & Touche LLP (USA), is published after each Task Force meeting and is intended for a general audience of financial professionals, including CFOs, controllers, and internal audit and accounting professionals. Past issues are Here.
13 October 2004: UK ASB urges compliance with full IAS 39
The United Kingdom Accounting Standards Board has issued a statement on the implications for UK financial reporting of the modified version of IAS 39 Financial Instruments: Recognition and Measurement recently endorsed by the Accounting Regulatory Committee of the European Commission. The ASB said:
|
The ASB strongly supports the view that all UK companies should comply as far as possible with the full hedging provisions of the standard and not the amended version.... If power to mandate full compliance lay with the Board, it would do so immediately. However, the Board understands that, as a consequence of the IAS Regulation, the Board may not currently have this power. The Board intends to explore all possible means of mandating compliance with the hedging requirements as soon as possible.
|
Click to download the ASB Statement (PDF 40k)
13 October 2004: IASB convergence project with Japan
The International Accounting Standards Board and the Accounting Standards Board of Japan (ASBJ) have held the first meeting to plan a joint project aimed at minimising differences between IFRSs and Japanese accounting standards towards a final goal of convergence of their standards. Sir David Tweedie, IASB Chairman, said: "The decision of the ASBJ to join with us to examine the differences between our standards and, where the economic facts are similar, to discuss which of our two methods best reflects economic reality is a major boost for the convergence of accounting standards worldwide. I applaud the decision of the ASBJ to take this historic step." Click for IASB Press Release (PDF 16k).
12 October 2004: Role of the audit committee examined
In her recent comments on The Role of the Audit Committee: The US Experience, US SEC Commissioner Cynthia A. Glassman spoke about application of the Sarbanes-Oxley Act to foreign registrants:
|
It is clear that the problems that led to the enactment of Sarbanes-Oxley are not exclusive to the United States. Corporate governance issues are just as important internationally, as evidenced by some of the recent Italian and other European scandals. We in the United States are also not the only ones crafting solutions to these problems. It is therefore incumbent upon all of us to work diligently to ensure that our solutions are appropriate and have the intended effect. The Commission therefore has and will continue to seek a balance between its responsibility to protect U.S. investors and the need to provide reasonable accommodations to foreign issuers.
|
12 October 2004: PCAOB staff Q&As on internal controls
The US Public Company Accounting Oversight Board has published a second 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. 27-29) address the scope and extent of testing, evaluating deficiencies, and service organisations. Click to download:
12 October 2004: IASC Foundation trustees will meet 25 October 2004
The trustees of the IASC Foundation, under which the IASB operates, will meet at the IASB's offices in London starting at 9:00am on Monday 25 October 2004. Agenda items include
- Report of the Constitution Committee
- Report of the IASB chairman:
- Update on IASB activities
- Report on IASB consultative procedures
- Recommendations regarding relationships with national standard-setters
- Report of the Trustees' Committee on IASB Procedures
11 October 2004: Deloitte comment letters on proposed IAS 39 amendments
We have posted three letters of comment submitted by Deloitte in response to the IASB's exposure drafts of proposed amendments to IAS 39:
- Day One Profit Recognition (PDF 67k) – We welcome the move to clarify the accounting for the gain or loss after initial recognition. However, we believe that the proposed wording is not sufficiently clear. We also encourage the Board to work closely with the FASB on this so as to prevent difference between the two GAAPs.
- Cash Flow Hedge Accounting of Forecast Intragroup Transactions (PDF 67k) – We welcome the clarification that, in the consolidated financial statements, a group can designate, as a hedged item in a foreign currency cash flow hedge, a highly probable external transaction denominated in the functional currency of the subsidiary entering into the transaction, provided it gives rise to an exposure that will have an effect on consolidated profit or loss. We also believe that as part of the proposed amendment the standard should state clearly that a commitment between two group entities without another commitment with an outside party does not meet the definition of a firm commitment and, therefore such an internal hedge does not qualify for hedge accounting,
- Financial Guarantee Contracts and Credit Insurance (PDF 79k) – We support the proposed approach in the exposure draft that the legal form of a financial guarantee contract should not affect its accounting treatment, Therefore we strongly support the proposal to bring financial guarantee contracts within the scope of IAS 39 and to remove them from the scope of IFRS 4.
11 October 2004: New Australian Accounting Alert posted
We have posted Australian Accounting Alert No. 17 (PDF 50k), which discusses a new amendment to AASB 1046 "Director and Executive Disclosures by Disclosing Entities". You will find all past Australian Accounting Alerts Here.
10 October 2004: Second day of the October 2004 IFRIC meeting
The International Financial Reporting Interpretations Committee (IFRIC) met in London for two days: 7 and 8 October 2004. Presented below are the preliminary and unofficial notes taken by the Deloitte observers at the second day of the meeting.
8 October 2004
 IFRIC D8 Members' Shares in Co-operative Entities
The IFRIC considered an overview paper outlining the responses to the exposure of this draft. It was noted that 74% of respondents agreed either fully or in part with the proposals.
The IFRIC considered in brief issues raised by respondents, including:
- Expanding the title of the interpretation to reflect its increased scope;
- The need for additional guidance clarifying the difference for accounting purposes between a prohibition on the creation of a liability, and the prohibition on the settlement of a liability;
- Agreeing in principle that the ability to change the Charter of an organisation does not affect the classification as liability or equity until such time as that change in Charter has occurred;
- The use and application of the portfolio approach;
- The need for transitional provisions, noting that in Europe these would be unnecessary as entities would be caught by the transitional provisions relating to adoption of IAS 32; and
- Whether profit or loss could ever arise on reclassification between liability and equity.
The objective of the session was to highlight issues and ensure IFRIC members believed all major issues arising in comment letters would be addressed by exploration of those issues. The IFRIC agreed to discuss these issues in more detail at its November meeting. In addition the IFRIC will consider a draft interpretation at its November meeting.
Service Concessions
The IFRIC was presented three draft interpretations in relation to service concessions to consider:
- D10A Service Concession Arrangements - Determining the Accounting Model
- D10B The Financial Asset Model
- D10C The Intangible Asset Model
Determining the accounting model
The IFRIC considered issues arising from the draft interpretation on selection of the accounting model. They noted that where there is a requirement for the grantor to pay, at the end of the concession, the fair value of the asset at that time, the arrangement would not be within the scope of the interpretations because the control tests are not met.
One IFRIC member raised a concern as to whether an operator can allocate different margins to different parts of a contract where the segmentation criteria in IAS 11 are not met. It was generally agreed that where output measures are used to measure completion then such accounting is possible, but this issue would be better considered as part of the combining and segmenting project, and should not hold up the release of the draft interpretations.
Some IFRIC members expressed concern about the use of the financial asset model when payments by the grantor depend on usage, but most IFRIC members believed this was acceptable. The IFRIC discussed widening the scope of the financial asset model to capture all arrangements where an entity has a right to receive cash (whether from the grantor, or from users with a grantor minimum guarantee), leaving arrangements where an entity only has the right to try and earn cash in the intangible asset model. The IFRIC agreed that the model as currently drafted should be released for exposure without this widening of the application of the financial asset model. The IFRIC also requested that wording be included to the effect that the existence of rate regulation (ie an ability to increase prices to offset lower than expected demand) does not by itself mean the financial asset model is appropriate, as such rate regulation is only effective in creating a financial asset where the possibility of non-recovery is remote.
The IFRIC briefly discussed transitional arrangements, and given the planned effective date of 1 January 2006, what, if anything could be done about accounting for these arrangements in 2005. It was agreed that they should not propose to suspend the hierarchy in respect of these arrangements for 2005, and therefore entities would have to determine accounting policies believed to be consistent with the hierarchy which, it was acknowledged, could include continuing to apply a fixed asset model.
The IFRIC also discussed whether a fair value at date of adoption transition model could be offered, and agreed that under the intangible asset model it could not because there is no active market (and therefore such a transitional alternative would be inconsistent with IFRS 1. It was generally agreed that the transitional arrangements as drafted (that where restatement is not practical the entity should reclassify the asset and test for impairment as of the beginning of the earliest period presented if possible) should be exposed for public comment.
Staff agreed to develop some additional worked examples of how each of the models work across a long-lived concession for consideration at the next meeting, and that these would be considered for incorporation into educational material rather than as part of the draft interpretations.
The Financial Asset Model
The draft interpretation considered by IFRIC was broadly consistent with the one considered at the September meeting. The IFRIC considered a number of issues, particularly around the measurement of a financial asset, including the effect of anticipated penalty clauses, and re-measurement when such assumptions change. It was agreed that this was outside of the scope of this interpretation.
It was noted that in the context of the financial asset model it would be unlikely that there would be material qualifying assets for the purposes of capitalising borrowing costs. It was agreed that the draft interpretation should explain this in more detail by outlining the interaction of IAS 11, IAS 18 and IAS 23 in this situation.
The Intangible Asset Model
The IFRIC revisited the issue discussed in previous meetings on the exchange transaction that occurs when the intangible asset model is used, resulting in revenue being recognised on the construction services (exchange of construction services for an intangible asset), followed by recognition of additional revenue resulting from the cash inflows from operations (perceived as a 'double counting' because ultimately only the one set of cash flows is received). A number of IFRIC members expressed their discomfort with this outcome, however only two IFRIC members indicated their intention to dissent on the basis of this issue. Other IFRIC members were uncomfortable, but unable to develop technical bases for dissenting as they believe this outcome is forced by the current literature.
There was considerable discussion around whether an entity should recognise the intangible as it completes construction services, recognise the intangible and a corresponding liability for performance on Day 1, or recognise a receivable as it completes construction services (being the right to receive an intangible). It was agreed that the interpretation should not be explicit on this issue, but should clarify that the intention is that the pattern of revenue recognition should be similar to that which would occur under ordinary IAS 11 construction contract accounting.
One IFRIC member indicated his intention to draft a dissent from the exchange model, on the basis that as you cannot segment the contract, only the total cash flows should be recognised as revenue (being the fair value of amounts received or receivable from the combined construction and operation activities) and agreed that he would not dissent from issuing the draft interpretation for comment if his dissent were adequately reflected in the basis for conclusions.
The IFRIC agreed that when the intangible asset model is being applied that the effect of any caps, floors etc should be recognised using an IAS 37 type model and that fair valuing such features should not be permitted.
Considerable confusion was noted around how repairs and maintenance obligations should be accounted for, and it was agreed that further application guidance was necessary. Such guidance would clarify that under the financial asset model, it would simply be a revenue deferral issue (that is the repairs and maintenance might be completed either before or after revenue in respect of these services was received, and the revenue should be accounted for according to whether the related service had yet been performed). Under the intangible asset model repairs and maintenance should be accounted for in accordance with IAS 37.
The IFRIC will consider draft interpretations at the meeting to be held in November with the intention of voting to issue them for public comment at that time. It is expected that there will be a 3 month comment period.
This summary is based on notes taken by observers at the IFRIC meeting and should not be regarded as an official or final summary.
|
9 October 2004: First day of the October 2004 IFRIC meeting
The International Financial Reporting Interpretations Committee (IFRIC) is meeting in London for two days: 7 and 8 October 2004. Presented below are the preliminary and unofficial notes taken by the Deloitte observers at the first day of the meeting.
7 October 2004
IFRIC D1 - Emission Rights
The IFRIC discussed the effective date of 1 March 2005 and underscored that its intention was for this Interpretation not to be effective for European first-time adopters although early adoption is encouraged.
The point was made that the Basis for Conclusions does not adequately support the decision taken for non-amortisation of the allowances under D1. In addition, concern was raised that the Basis for Conclusions appears to give the impression that application of IAS 38 would result in an accounting treatment that is not representationally faithful. Staff agreed to revisit the drafting.
Other editorial type issues were discussed.
No objections were noted to the finalisation of this Interpretation, subject to editorial amendments.
IFRIC D7 - Scope of SIC 12 Consolidation - Special Purpose Entities
At this meeting, the staff presented to the IFRIC, an analysis of the 26 comment letters received.
Removal of scope exclusion for equity compensation plans
All respondents agreed with the proposal to remove from SIC-12 the scope exclusion for equity compensation plans.
Post-Employment and Other Long-Term Benefit Plans
Most respondents agreed with the proposed amendment. However, some respondents expressed concerns about how the proposed amendment would affect defined contribution plans. The IFRIC discussed this issue at length and agreed with the Staff proposal that the only change that should be made to the scope of SIC-12 in respect of post-employment benefit plans is to simply add a reference to 'other long-term employee benefit plans', i.e. so as to read:
"This Interpretation does not apply to post-employment benefit plans or other long-term employee benefit plans."
D6 Multi-employer Plans
Due to the overwhelmingly unfavourable responses to D6, staff proposed that IFRIC recommend to the IASB that an amendment to IAS 19 be considered so as to provide a blanket exemption from defined benefit accounting and to require instead, defined contribution accounting with additional disclosures. Respondent's main concern was the availability of information as well as the reliability of the apportionment amongst participants in a multi-employer plan.
The IFRIC discussed this issue at length with certain members indicating that the staff proposal was a step backward from the correct answer. Members reaffirmed the intention of D6 as that of moving the accounting by participants of multi-employer plans towards defined benefit accounting. A blanket exemption would therefore be less satisfactory than the current IAS 19 requirements that IFRIC sort to improve.
IFRIC decided not to proceed with D6 but to bring the issue to the IASB's attention for consideration and guidance.
D3 - Determining Whether an Arrangement Contains a Lease
Editorial type issues were discussed and no objections were noted to the finalisation of D3.
Waste Electrical and Electronic Equipment
Editorial type issues were discussed and no objections were noted. A draft Interpretation will be finalised and forwarded to IASB members for negative clearance.
Report of Agenda Committee and Activities of Other Interpretive Bodies
Staff presented the issues raised to the Agenda Committee as well as other interpretive bodies. These issues were noted.
Application Issues for IAS 1
The IFRIC were asked to consider whether to add to its agenda, the following application issues in respect of IAS 1:
a. whether it is acceptable to present net finance costs on the face of the income statement without showing the finance costs and finance revenue composing it; and
b. whether particular expenses (such as impairments, inventory write-downs and restructuring costs) may be omitted from functional classifications to which they relate and presented on a nature of expense basis.
The IFRIC was in general agreement that in the case of issue (a), netting is not allowed.
After some discussion, the IFRIC decided to not to take issue (b) on the agenda as this could best be dealt with as an amendment to IAS 1. The IFRIC agreed to raise both these issues with the IASB in order to gauge whether the Board could deal with these issues under the Performance Reporting project.
This summary is based on notes taken by observers at the IFRIC meeting and should not be regarded as an official or final summary.
|
7 October 2004: Agenda for October 2004 IASB meeting
The IASB will meet at the offices of the Financial Accounting Standards Board (FASB), Norwalk, Connecticut, USA, on 18-20 October 2004. The third day will be a joint meeting with the FASB. The agenda topics for the meeting are as follows:
|
Agenda of the IASB Meeting 18-20 October 2004
Agenda – IASB only, 18-19 October 2004
- Business Combinations II
- Convergence - Post-employment Benefits
- Convergence - Income Taxes
- IAS 37 Amendments
- IFRIC Matters
- Financial Reporting by Small and Medium-sized Entities
Agenda – Joint IASB/FASB Meeting, 20 October 2004
- Convergence - Income Taxes
- Conceptual Framework
- Financial Instruments
- Revenue Recognition
|
7 October 2004: Comment letters posted on SMEs, D7, D8, D9
The IASB has Posted on its Website comment letters received on the following projects:
*Some letters on D7 and D8 had previously been posted. These are additional letters.
6 October 2004: IFAC exposure draft on ethics
The International Federation of Accountants has invited comment on an exposure draft of a Revised Code of Ethics for Professional Accountants. The revisions are intended to clarify the independence requirements for professional accountants in public practice who perform assurance engagements. Comment deadline is 30 November 2004.
6 October 2004: Latest Accounting Roundup posted
The 4 October Edition of Accounting Roundup (PDF 245k) 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.
5 October 2004: Financial reporting in Bhutan
The Companies Act of Bhutan (2000) states that listed companies must present their financial statements in compliance with GAAP. Whilst there is no defined Bhutanese GAAP, the provision of the Companies Act is usually construed to mean India GAAP, to which Bhutan is closely linked. Listed companies in Bhutan are therefore not permitted to apply IFRSs directly. We have updated our Table of Country Use of IFRSs accordingly.
4 October 2004: ARC endorses IAS 39 with two parts modified
At its meeting in Brussels on 1 October 2004, the Accounting Regulatory Committee of the European Commission voted to recommend endorsement of IAS 39 for use in Europe, with two modifications. The modifications (1) prohibit use of the IAS 39 fair value option as it applies to liabilities, and (2) allow using fair value hedge accounting for interest rate hedges of core deposits on a portfolio basis. With respect to hedging of core deposits, EU member states can elect to require the unmodified version of IAS 39. Further, if a Member State permits the modified version, companies can elect to apply the unmodified IAS 39. Click to download the published ARC Opinion (PDF 13k). The fair value option as it applies to liabilities is regarded as inconsistent with the IV Accounting Directive and therefore the modification is required for all companies. Even though IFRSs become mandatory in Europe in 2005, the ARC has yet to vote on endorsement of the revised versions of 14 IASs that were adopted by the IASB in December 2003 as part of its Improvements Project (to date, the EC has endorsed only the pre-2003 versions). Nor has the ARC endorsed IAS 32, IFRSs 2 through 5, or IFRIC 1. These are expected to be considered at ARC's 30 November 2004 meeting.
4 October 2004: David Tweedie's testimony on IAS 39 is available
The IASB has released the Testimony (PDF 63k) of IASB Chairman Sir David Tweedie before the Committee on Monetary and Economic Affairs of the European Parliament on 22 September 2004. Sir David's prepared statement includes a report on the history, background, and progress of discussions on IAS 39. An excerpt:
|
The Committee asked the IASB to appear to discuss progress with IAS 39 and the proposals of the European Commission. In this statement, I shall focus on IAS 39, because the IASB has not taken a position on the proposals for endorsement. But I should emphasise at the outset that full endorsement of all of the IASB's standards, including IAS 39, is our preferred option. Although we are aware of the challenges that endorsement would pose, we are concerned that piecemeal approval of any of the IASB's standards risks undermining the coherence and integrity of the standards and making them more difficult to apply
consistently. |
4 October 2004: Update on IASCF constitution review
On 6 October 2004 in Mexico City, the Constitution Committee of the IASC Foundation will hold its fourth and last public hearing on possible changes to the Foundation's constitution, under which the IASB operates. The three earlier hearings were held in New York, London and Tokyo. The Constitution Committee met on 22 September 2004 and reached some preliminary conclusions on possible amendments to the constitution. These preliminary conclusions are subject to further consideration after the Mexico City hearing. To bring participants in the Mexico City hearing up to date with the Committee's thinking, the Committee has published a paper titled An Update on the Constitution Review for the Public Hearing in Mexico City (PDF 23k).
3 October 2004: Enforcement of financial information in Europe
In June 2004, the Committee of European Securities Regulators (CESR) invited comments on a proposed approach to implementing its Standard No. 2, Coordination of Enforcement Activities. Standard 2 establishes principles for coordinating enforcement of financial information, including information based on IFRSs, at a pan-European level. CESR's Proposal (PDF 99k) involves guidance for implementing those principles. CESR has now posted on its website the Responses to that Proposal.
2 October 2004: Our plan for the remaining IFRS e-learning modules
|
|
Deloitte's IFRS e-learning programme, available for download and self-study to all without charge, has proved enormously popular. So far, 24 modules are available. All of the remaining modules (namely IASs 23, 24, 29, 32/39 Parts 2 and 3, 36, and 38, and IFRSs 2, 3, and 5) are scheduled for release before the end of the year. The table below is a status report with estimated release dates for the remaining modules. Click on the light bulb icon on our home page for access.
|
| Standard | E-learning Available |
|---|
| IAS 1 Presentation of Financial Statements | Now |
| IAS 2 Inventories | Now |
| IAS 7 Cash Flow Statements | Now |
| IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors | Now |
| IAS 10 Events After the Balance Sheet Date | Now |
| IAS 11 Construction Contracts | Now |
| IAS 12 Income Taxes | Now |
| IAS 14 Segment Reporting | Now |
| IAS 16 Property, Plant and Equipment | Now |
| IAS 17 Leases | Now |
| IAS 18 Revenue | Now |
| IAS 19 Employee Benefits | Now |
| IAS 20 Accounting for Government Grants | Standard to be replaced |
| IAS 21 The Effect of Changes in Foreign Exchanges Rates | Now |
| IAS 22 Business Combinations | See IFRS 3 |
| IAS 23 Borrowing Costs | 31st October 2004 |
| IAS 24 Related Party Disclosures | 31st December 2004 |
| IAS 26 Accounting and Reporting by Retirement Benefit Plans | Not required |
| IAS 27 Consolidated and Separate Financial Statements | Now |
| IAS 28 Accounting for Investments in Associates | Now |
| IAS 29 Financial Reporting in Hyperinflationary Economies | 31st October 2004 |
| IAS 30 Disclosures in the Financial Statements of Banks and Similar Financial Institutions | Standard to be replaced |
| IAS 31 Financial Reporting of Interests in Joint Ventures | Now |
| IAS 32/39 Part 1 Key Principles | Now |
| IAS 32/39 Parts 2 and 3 Hedging and Derecognition | 31st December 2004 |
| IAS 33 Earnings Per Share | Now |
| IAS 34 Interim Financial Statements | Now |
| IAS 35 Discontinuing Operations | See IFRS 5 |
| IAS 36 Impairment of Assets | 31st October 2004 |
| IAS 37 Provisions, Contingent Liabilities and Contingent Assets | Now |
| IAS 38 Intangible Assets | 31st October 2004 |
| IAS 40 Investment Property | Now |
| IAS 41 Agriculture | Now |
| IFRS 1 First time adoption | Now |
| IFRS 2 Share Based Payments | 31st December 2004 |
| IFRS 3 Business Combinations | 31st October 2004 |
| IFRS 4 Insurance | Not Required |
| IFRS 5 Discontinued Operations | 31st December 2004 |
| IFRS 6 Extractive Industries | Not Required |
| Framework | Now |
| Using IFRS E-learning | Now |
1 October 2004: ARC consideration of all except IAS 39 is deferred
The agenda for the European Commission's Accounting Regulatory Committee meeting of 1 October 2004 had included not only consideration of IAS 39 but also whether to recommend endorsement of the improvements to 14 IASs that were adopted as revised standards in December 2003 (to date, the EC has endorsed only the pre-2003 versions) and IFRSs 2 through 5 (see news story of 20 September). The final agenda now shows that only IAS 39 will be considered at the 1 October 2004 meeting. The other standards, along with IAS 32 and IFRIC 1, will be considered at ARC's 30 November 2004 meeting.
1 October 2004: IVSC newsletter analyses fair value accounting
The growing use of fair value measurements in IFRSs is the focus of the latest edition of IVSC Global Valuation Issues (PDF 281k) published by the International Valuation Standards Committee (IVSC). "With the introduction of International Financial Reporting Standards in many parts of the
world, including for all publicly listed companies in the European Union in 2005, the correct application of Fair Value on a consistent and transparent basis is vitally important," the IVSC notes. The newsletter examines the differences between "fair value" as used in IASB and FASB literature and "market value" as used in IVSC standards. Also in the newsletter is an analysis of fair values under IFRS 3 and IFRS 5 and a summary of the FASB's Fair Value Measurements exposure draft.
1 October 2004: Reminder of three comment deadlines next week
|
The comment periods on three IASB exposure drafts of amendments to IAS 39 end on 8 October 2004:
|
1 October 2004: European standard setters' meeting
On 6 October 2004, the European Financial Reporting Advisory Group (EFRAG) will hold a meeting of representatives of all European national standard setters in Brussels. The main agenda items will be the IASB projects on measurement and concession arrangements, and EFRAG's letter of comment on the IASB's proposed amendments to IAS 39. The EFRAG Technical Experts Group will then meet on 7-8 October 2004. Click for More Information on EFRAG website.
|
