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31 July 2006: IAS Plus Newsletters for July 2006

The July 2006 IAS Plus Quarterly Newsletter has been published. The newsletter reports on the 2nd quarter 2006 activities of the IASB, the IFRIC, and the IASC Foundation, and also on worldwide issues and events relating to international financial reporting. The Asia-Pacific edition has the same 28-page news content as the Global Edition plus 10 more pages of accounting standards updates for the Asia-Pacific region. July 2006 Global Edition (PDF 311k) July 2006 Asia-Pacific Edition (PDF 373k) You will find all Past IAS Plus Issues Here. Sign up for Free Subscription by Email.

31 July 2006: IAASB guidance for national modifications to ISAs
The International Auditing and Assurance Standards Board (IAASB) has published A Guide for National Standard Setters that Adopt the IAASB's International Standards but Find It Necessary to Make Limited Modifications. The guide is non-authoritative. The IAASB has issued it in the interest of seeking a common understanding among national standard setters, regulators, and the public, regarding the circumstances that the IAASB believes should exist before a national standard setter may assert that its standards conform to the IAASB's International Standards. Click to Download the Policy Guide from the IAASB's website (PDF 174k).

30 July 2006: Webcast on latest developments in IFRSs and UK GAAP

For the past two years, the Deloitte United Kingdom IFRS Centre of Excellence has been running a series of hour-long Internet-based IFRS technical updates, focusing on the most important IFRSs and how they will affect UK companies. Starting with July 2006, these webcasts will be conducted two or three times each year and will focus on the latest developments in IFRSs and UK GAAP. The eighteenth session was run on Thursday 27 July 2006. The content for this webcast was:

• recent IASB proposals (IFRS 2, IAS 14, IAS 32, IAS 1, IAS 23)
• narrative reporting update (OFRs, EBRs)
• recent IFRIC and UITF activity (IFRICs 8 to 10)
• IFRS 7 Financial Instruments: Disclosures (practical issues)
• other UK matters (proposed pension disclosures, group accounts exemption, auditors' remuneration disclosure)

29 July 2006: Heads Up newsletter on IASB-FASB concepts paper
Deloitte & Touche LLP (United States) has published a special issue of the Heads Up Newsletter (PDF 90k) summarising an IASB Discussion Paper and a related FASB Preliminary Views document, Conceptual Framework for Financial Reporting: Objective of Financial Reporting and Qualitative Characteristics of Decision-Useful Financial Reporting Information. These documents, identical in all significant respects, are the first in a series of expected publications that are part of a joint project to replace the two boards' separate conceptual frameworks. The IASB Discussion Paper and the FASB Preliminary Views document can be downloaded from the boards' websites: www.iasb.org and www.fasb.org.

29 July 2006: PCAOB alert on stock option accounting and auditing
The US Public Company Accounting Oversight Board has issued the first in a new series of Audit Practice Alerts issued by the Board's staff. These alerts will highlight new, emerging, or otherwise noteworthy circumstances that may affect how auditors conduct audits under the existing requirements of PCAOB standards and relevant laws. The PCAOB has issued Staff Audit Practice Alert No. 1 addresses "Matters Relating to Timing and Accounting for Options Grants". It was prompted by recent reports and disclosures about issuer practices related to the granting of stock options, including the backdating of such grants. The alert advises auditors that these practices may have implications for audits of financial statements or of internal control over financial reporting and discusses factors that may be relevant in assessing the risks related to these matters. Click for:

• Staff Audit Practice Alert No. 1 (PDF 89k)
• News Release (PDF 58k)
• Deloitte Heads Up Alert (PDF 113k) reviewing the PCAOB's new guidance

27 July 2006: US SEC names new Chief Accountant

Conrad Hewitt, a former chief financial regulator for the State of California, has been named Chief Accountant of the US Securities and Exchange Commission effective 18 August 2006. Mr. Hewitt currently chairs the audit committees of Varian, Inc., North Bay Bancorp, S&P Co., and Pabst Brewing Co. From 1995 to 1998, he was California Superintendent of Banking and Commissioner of the California Department of Financial Institutions. From 1972 to 1995, Mr. Hewitt was the Managing Partner of Ernst & Young, and its predecessor firm, Ernst & Ernst, in the firm's Northern California (1986-95), Seattle (1979-86), and Honolulu (1972-79) regions. Click for SEC Press Release.

27 July 2006: Agenda project pages updated

We have updated the following agenda project pages to reflect the deliberations and decisions of the IASB at the Board's July 2006 meeting.

• Accounting Standards for Small and Medium-sized Entities
• Amendments to IAS 37
• Business Combinations II
• Conceptual Framework
• Consolidations
• Financial Statement Presentation
• IFRS 2 – Vesting Conditions and Cancellations
• Insurance Contracts - Phase 2
• Leases
• Post-Employment Benefits, including Pensions
• Related Party Disclosures
• Revenue Recognition
• Segment Reporting
• Short-term Convergence: Interests in Joint Ventures

26 July 2006: IFAC posts responses to part 2 of compliance survey
The International Federation of Accountants has posted the responses of more than 95 IFAC members and associates to Part 2 of IFAC's Member Body Compliance Program. Under the Compliance Program, IFAC members and associates were asked to provide information about the regulatory and standard-setting framework is in their country (Part 1) and their organisations' activities in addressing IFAC's membership requirements (Part 2) as described in IFAC's Statements of Membership Obligations. IFAC's website now has Links to the Part I and Part II Responses. The 95 Part II responses are finalised reports containing information about the professional standards, quality assurance, and investigation and discipline programs in place for professional accountants are in the process of being posted to the IFAC website and are accessible to the public. Over 150 responses to Part 1 are also available. Click here for more information about IFAC's Compliance Program.

25 July 2006: No new major IFRSs will be effective until 2009
The IASB has announced a number of steps to assist jurisdictions and entities in adopting IFRSs and to enhance its consultation processes. The most significant announcement is that no new IFRSs will be effective until 2009. Following consultation with the Trustees of the IASC Foundation, the Standards Advisory Council, and a wide range of interested parties, the IASB has agreed to the following:

25 July 2006: Nominees sought for working group on lease accounting
On 19 July 2006, the IASB and the US Financial Accounting Standards Board added a joint project on leasing to their respective agendas. The project scope includes a reconsideration of existing standards of accounting for both lessees and lessors. The current project plan envisages, as a first step, the publication of a joint discussion paper. The boards plan to appoint a single international working group to advise both boards on the project. The working group will comprise individuals from a variety of backgrounds, including preparers, auditors, and users of financial statements, leasing experts, and others. The boards request nominations by 30 September 2006. Click for Joint IASB-FASB Announcement on the Leasing Working Group (PDF 37k).

23 July 2006: IFRS-Chinese GAAP comparison in Chinese

Deloitte (China) has published a comparison of IFRSs and the new Chinese Accounting Standards adopted by the Ministry of Finance of the People's Republic of China that are effective in 2007 for listed companies. You can download the Chinese Language Version of the Comparison (PDF 877k) now. The comparison will be available shortly in English on our China Page.

22 July 2006: Notes from the fourth day of the July 2006 IASB meeting
The International Accounting Standards Board held its July 2006 Board meeting at its offices, 30 Cannon Street, London, on Tuesday through Friday 18-21 July 2006. Click here to go to our Notes Taken by Deloitte Observers at the July 2006 Board Meeting.

22 July 2006: Notes from the third day of the July 2006 IASB meeting
The International Accounting Standards Board held its July 2006 Board meeting at its offices, 30 Cannon Street, London, on Tuesday through Friday 18-21 July 2006. Click here to go to our Notes Taken by Deloitte Observers at the July 2006 Board Meeting.

21 July 2006: Notes from the second day of the July 2006 IASB meeting
The International Accounting Standards Board held its July 2006 Board meeting at its offices, 30 Cannon Street, London, on Tuesday through Friday 18-21 July 2006. Click here to go to our Notes Taken by Deloitte Observers at the July 2006 Board Meeting.

20 July 2006: IFRIC Interpretation on interim reporting
The International Financial Reporting Interpretations Committee (IFRIC) has issued Interpretation 10 Interim Financial Reporting and Impairment. The Interpretation addresses an apparent conflict between the requirements of IAS 34 Interim Financial Reporting and those in other standards on the recognition and reversal in financial statements of impairment losses on goodwill and certain financial assets. IFRIC 10 concludes that:

• An entity shall not reverse an impairment loss recognised in a previous interim period in respect of goodwill or an investment in either an equity instrument or a financial asset carried at cost.
• An entity shall not extend this consensus by analogy to other areas of potential conflict between IAS 34 and other standards.

20 July 2006: Notes from the first day of the July 2006 IASB meeting
The International Accounting Standards Board held its July 2006 Board meeting at its offices, 30 Cannon Street, London, on Tuesday through Friday 18-21 July 2006. Click here to go to our Notes Taken by Deloitte Observers at the July 2006 Board Meeting.

19 July 2006: Deloitte sponsors IFRS 2006/7 conference

Deloitte is sponsoring IFRS 2006/7, a conference that will focus on the Current Practical Interpretation and Future Strategic Direction of IFRSs. IFRS 2006/7 will be held on 10 October 2006 in London. Speakers include: Sir David Tweedie, Chairman of the IASB Robert H Herz, Chairman of the FASB Ken Wild, Deloitte's Global IFRS Leader Click to download the Conference Brochure (PDF 234k), which includes a detailed programme and registration form.

18 July 2006: IASC Foundation seeks four Trustees
The IASC Foundation has begun a search to fill four vacancies for Trustees. Two of the four appointments will be from North America, one from Europe, and one from any area of the world. In selecting a Trustee from any area of the world, the Trustees have expressed a preference for candidates from Africa. The appointments will be for three years, commencing on 1 January 2007 and ending on 31 December 2009. Terms may be renewed for a further three years. Click for IASCF Announcement (PDF 25k).

18 July 2006: Two changes to agenda for July 2006 IASB meeting

The IASB has announced two changes to the Agenda of its July 2006 Board Meeting:

• The following topic previously scheduled for Friday morning has been removed from the agenda: Proposed Amendments to IFRS 1 – Cost of investment in a subsidiary
• Discussion and possible agenda decision for Related Party Disclosures has been moved from last agenda item on Thursday to Friday morning.

17 July 2006: Accounting Roundup – second quarter 2006 review
We have posted the Accounting Roundup: Second Quarter in Review– 2006 (PDF 397k), prepared by the National Office Accounting Standards and Communications Group of Deloitte & Touche LLP (USA). During the second quarter of 2006, accounting standard-setters and accounting regulators issued a number of final and proposed FASB Interpretations, FSPs, EITF consensuses, SEC rules, PCAOB rules, IFRSs, etc. affecting accounting, financial reporting, and corporate governance. Accounting Roundup: 2nd Quarter in Review–2006, presents brief descriptions of those pronouncements, as well as certain other regulatory and professional developments in accounting and financial reporting. The articles included derive from issues of the Accounting Roundup newsletters published in the second quarter of 2006, with updates added where appropriate. You will find past issues Here.

17 July 2006: Concerns about the conceptual framework proposals
The United Kingdom Accounting Standards Board (ASB) has recently published two press releases relating to the IASB's new Discussion Paper on the objectives and qualitative characteristics components of the Conceptual Framework of Financial Reporting One of the ASB's releases expresses concerns about the proposals in the Discussion Paper in general. Those concerns relate to:

• the proposal that the objective of financial reporting should focus only on decision-usefulness, with stewardship being subsumed within this rather than a specific part of the objective, or a separate objective.
• the focus on financial reporting, not just the financial statements – can the same framework be more widely applied?
• the widening of the definition of the primary users of financial reports to cover 'present and potential investors and creditors, and their advisors' – does this mean that the focus will move even further away from meeting the needs of the existing shareholders?
• the proposal to drop 'reliability' as a qualitative characteristic and to replace it with 'faithful representation'; and
• the introduction of verifiability as a component of faithful representation.
  Click to download:
  
  • IASB-FASB Press Release on the Discussion Paper (PDF 37k).
  • Press Release – ASB Concerns (PDF 66k)

• an insufficient emphasis on accountability/stewardship;
• a need to broaden the identified users and establish an alternative primary user group; and
• the inappropriateness of the pervasive cash flow focus.
  Click to download:
  
  • ASB Press Release – Nonprofit (PDF 60k)
  • Joint Background Paper (PDF 146k)

17 July 2006: Deloitte letter on proposed amendments to IAS 1

We have posted the Deloitte letter of comments to the IASB on IAS 1 Presentation of Financial Statements: A Revised Presentation (PDF 90k). Our overall view:

17 July 2006: Heads Up newsletter on FASB income tax interpretation
Deloitte & Touche LLP (United States) has published a special issue of the Heads Up Newsletter (PDF 143k) summarising FASB Interpretation No 48 Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109. This interpretation is effective for financial years beginning after 15 December 2006, with early adoption encouraged. The interpretation takes a two-step approach for recognising and measuring tax benefits:

• 1. Recognition: For each tax deduction or other tax position, an entity must make a hypothetical assessment: if a dispute with the taxing authority were taken to the court of last resort, is it more likely than not that the tax position would be sustained as filed? If it is, the recognition threshold is met.
• 2. Measurement: An entity should recognise the largest amount of tax benefit that is greater than 50 percent likely of being realised upon ultimate settlement with the taxing authority. In this step, the enterprise should also presume that the taxing authority has full knowledge of all relevant information.

16 July 2006: Newsletter explaining ED on puttable shares

In June 2006, the IASB published an exposure draft on Financial Instruments Puttable at Fair Value and Obligations Arising on Liquidation. The proposals would amend IAS 32 Financial Instruments: Presentation and IAS 1 Presentation of Financial Statements. Deloitte has published a Special Edition of Our IAS Plus Newsletter (PDF 58k) explaining the proposed changes. The ED would require: An obligation to redeem or repurchase a financial instrument puttable at fair value would be classified as equity provided that specified criteria are met, particularly that all financial instruments in the most subordinated class of instruments with a claim to the assets of the entity are financial instruments puttable at fair value. An instrument that imposes an obligation to deliver to another entity a pro rata share of the net assets of the entity upon its liquidation to be classified as equity, provided specified criteria are met. Thus, for example, ordinary shares of limited life entities and partners' interests in a partnership that must liquidate upon exit of a partner (eg on retirement or death) would be equity. Comments are due by 23 October 2006. The ED is available on the IASB's website. This and nearly 90 past newsletters are always available Here.

15 July 2006: IFRIC meeting dates for 2007

Meeting dates of the International Financial Reporting Interpretations Committee (IFRIC) in 2007 have been announced. All are in London at the IASB's offices, 30 Cannon Street:

14 July 2006: IASCF begins search to fill 2007 Board vacancies

Mr Cope

Ms O'Malley

Mr Smith

The IASC Foundation (IASCF), under which the IASB operates, has begun its search to fill three Board Member positions effective 1 July 2007. The appointments of two full-time IASB members (Anthony T Cope and Patricia O'Malley) and one part-time IASB member (John T Smith) will end on 30 June 2007. Mr Cope and Ms O'Malley are not eligible for reappointment. Mr Smith is eligible for reappointment and will receive particular consideration from the IASCF Trustees. The Trustees invite applications for both the full-time and part-time positions. Part-time membership means that the member concerned commits most of his or her time in paid employment to the IASCF. The qualifications of candidates will be considered on the basis of the criteria listed in the Annex of the IASC Foundation's Constitution (Excerpted Here). Interested persons are invited to apply by 15 September 2006. Click for Search Announcement (PDF 23k).

13 July 2006: ECOFIN's conclusions on IASB funding

At its meeting on 11 July 2006, the Economic and Financial Affairs Council (ECOFIN) of the European Union discussed the funding of the International Accounting Standards Board and adopted the following conclusions. Click for Full Text of Provisional Report of the Meeting (PDF 240k):

12 July 2006: IASB meeting dates for 2007

Dates of the IASB's meetings in 2007, including meetings with the Standards Advisory Council and with World Standard Setters, are as follows. All are in London except the October 2007 Joint Meeting with the FASB, which is at the FASB's offices in Norwalk, Connecticut, USA:

12 July 2006: SEC concept release on internal control reporting
The Securities and Exchange Commission, in another step toward improving the implementation of the Sarbanes-Oxley investor protection law, today published a Concept Release as a prelude to its forthcoming guidance for management in assessing a company's internal controls for financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002. The Commission anticipates that the forthcoming guidance for management will cover at least these areas:

• Identifying risks to financial statement account and disclosure accuracy and the related internal controls that address the risks, including how management might use company-level controls to address the risks
• Objectives of the evaluation procedures and methods or approaches available to management to gather evidence to support its assessment
• Factors management should consider to determine the nature, timing, and extent of its evaluation procedures
• Documentation requirements, including overall objectives of the documentation and factors that might influence documentation requirements

• Concept Release (PDF 213K)
• Press Release (PDF 37K)

12 July 2006: Canada's plan to move toward IFRSs for public companies
An article titled Going Global in the June 2006 issue of CA Magazine (published by the Canadian Institute of Chartered Accountants) explains Canada's new plan to converge Canadian GAAP with IFRSs over a transitional period of five years. During that time, the Accounting Standards Board of Canada will focus its efforts on removing the differences between Canadian GAAP and IFRSs by replacing individual Canadian standards with IFRSs. The article presents views on the Canadian convergence plan from the perspectives of financial executives, auditors, regulators, and standard setters. Click here for a Link to the Article on the CICA Website.

11 July 2006: IASB funding is on ECOFIN's agenda
At its meeting on 11 July 2006, the Economic and Financial Affairs Council (ECOFIN) of the European Union will discuss changes to the funding of the International Accounting Standards Board – in particular how the IASB might be made less dependent on major accounting firms for funding. EU Finance Ministers are expected to address how to widen the IASB's base of financial support, and also whether public funding could be used if a broadened voluntary scheme proves unpopular. From the agenda:

11 July 2006: American Accounting Association invites student members globally
The American Accounting Association has opened student membership to full-time students residing anywhere in the world. Student members pay discounted membership dues, receive their selected Association journals online, and may participate in AAA meetings and activities. Additionally, student members may register to attend the AAA Annual Meeting at a well-discounted registration fee of US$180.

• Information and a membership application can be found online at http://aaahq.org/membership/student_member.htm.
• A student interested in registering for the AAA Annual Meeting 6-9 August 2006 in Washington, DC should send an email to membership@aaahq.org for registration instructions.
• 2006 Annual Meeting Website

11 July 2006: Editorial corrections to 2006 Bound Volume of IFRSs

	The IASB has posted to its website a list of Editorial Corrections to the 2006 Bound Volume of IFRSs. There are 15 minor corrections.
	The 2006 Bound Volume of International Financial Reporting Standards includes all IFRSs, IASs, Interpretations, and the supporting documents published by the IASB – Bases for Conclusions, Implementation Guidance, and Illustrative Examples – as approved at 1 January 2006. Copies of BV2006 are available at £60 each from the IASB's Website (then click on IASCF Shop). Bulk discounts are available.

11 July 2006: June 2006 Accounting Roundup posted

We have posted the June 2006 Edition of Accounting Roundup (PDF 301k) published by Deloitte & Touche LLP (USA). Topics covered in this issue include:

10 July 2006: IFRIC agenda topic pages updated

We have updated our web pages for the following individual agenda topics to reflect decisions made at the July 2006 meeting of the International Financial Reporting Interpretations Committee (IFRIC):

• IAS 18: Customer Loyalty Programmes
• IAS 18: Guidance on Identifying Agency Arrangements [new web page added]
• IAS 19: The effect of a minimum funding requirement on the asset ceiling
• IAS 39 : Securitisations – derecognition of groups of financial assets
• IAS 39: Identification of a portion of an exposure eligible for hedge accounting [new web page added]
• IFRIC D17 – IFRS 2: Group and Treasury Share Transactions
• IFRIC D12-14: Service Concession Arrangements

8 July 2006: Notes from second day of the July 2006 IFRIC meeting
The International Financial Reporting Interpretations Committee (IFRIC) met at the IASB's offices in London on Thursday 6 July and Friday 7 July 2006. Presented below are the preliminary and unofficial notes taken by Deloitte observers at the second and final day of the meeting.

Friday 7 July 2006 Employee Benefit Trusts in the Individual or Separate Financial Statements of the Sponsor At the May 2006 meeting, the IFRIC was asked to interpret an issue on accounting for employee benefit trusts that is established by a sponsoring entity to facilitate the transfer of equity instruments to the sponsoring entity's employees under share-based payment arrangements. At that meeting the IFRIC decided to add the issue to its agenda. The IFRIC was concerned whether boundaries between the sponsor and the employee benefit trust could be identified. The IFRIC discussed the notion of an 'entity' in IFRS, and agreed that there is no clear guidance in current IFRSs on whether an employee benefit trust is an entity or not. However the IFRIC seemed to agree on that if the trust is a legal entity and has ownership of the shares, each transaction should be treated separately in the individual financial statements of the sponsor and the employee benefit trust. Decision. The IFRIC agreed that without a clear definition of what an entity is, the IFRIC could not issue an interpretation. Therefore the IFRIC decided that the issue should be rejected from the agenda, and that the IFRIC would inform the Board on this decision. IAS 39 Financial Instruments: Recognition and Measurement – Identification of a portion of an exposure eligible for hedge accounting The IFRIC continued to deliberate whether a financial asset or financial liability can be designated as a hedged item with respect to only a portion of the risks of changes in its fair value or its cash flows. The IFRIC had previously asked the staff to explore whether the wording in IAS 39.AG100 could be used to establish a principle for identifying a portion that could be eligible to be used in hedge accounting. The IFRIC discussed the scope of the word 'portion' in IAS 39. The discussion focussed on different components of financial assets/liabilities and whether those components would be identifiable and reliably measurable. Some members said that a key issue would be whether the effect of an identified portion is predictable, since this would be required to perform prospective assessment of the hedge effectiveness. Decision. The IFRIC decided that the staff should prepare a paper exploring the scope of portions in relation to hedging under IAS 39. The staff should try to develop criteria for what could qualify as a portion. Recommendations from the IFRIC Agenda Committee and the staff Classification of puts and forwards held by minority interests and puts or forwards received by a minority interest in a business combination contingent consideration The IFRIC discussed two related questions: 1. How to classify puts and forwards held by minority interests. 2. Are puts or forwards received by minority interests in a business combination contingent consideration? Two issues related to the first question were: Whether a parent should recognise a liability for the amount payable to the minority interest due to the holding of the puts or when the parent have a forward contract to buy the shares. Should a minority interest continue to be recognised? The issue in the second question is whether variability in the amount potentially payable to a minority interest under a forward contract or a put held by the minority is contingent/deferred consideration according to IFRS 3. The issues were initially presented as separate items, but IFRIC members found them related, and discussed both papers during the same session. On the first issue, IFRIC members were divided as to whether an IFRS 3 approach should be applied for the contracts. Some IFRIC members did not like the approach of applying IFRS 3 to the initial transaction (where, for instance, a company issues puts to the minority interest, and where there are uncertainty whether the business transaction would happen). Hence, business combination accounting would only occur when the minority interest decides to exercise the option. Decision. The IFRIC decided not to add this topic to its agenda. The rejection statement will address the accounting for the obligation represented by the put or forward. The rejection wording will have no reference to whether a minority interest should continue to be recognised. Regarding the second topic, the IFRIC agreed that they would not be able to finish an interpretation before the standard on business combinations would be issued. It is expected that the new standard would address this issue. Decision. It was decided that the second topic should not be added to the agenda, as the IFRIC agreed that they could not issue an Interpretation before the new standard on business combinations is expected to be issued. SIC 12 Consolidation: Special Purpose Entities - Relinquishment of control Paragraph 10 in SIC-12 has four indicators for assessing whether an entity controls an SPE. IFRIC has been asked whether any of the indicators carries greater weight than others in determining who has control over an SPE. Decision. The IFRIC agreed to reject this issue, stating that it is not possible to reach a general conclusion as to whether any of the indicators carries greater weight than others, but rather it depends on facts and circumstances. Definition of a derivative – Indexation on own EBITDA or own revenue The IFRIC considered a request to interpret whether a contract that is indexed on an entity's own revenue or own EBITDA meets the definition of a derivative under IAS 39. The IFRIC first considered whether the exemption in paragraph 9(a) applies to non-financial variables only in insurance contracts. The IFRIC agreed that the exemption is not restricted to insurance contracts. The IFRIC then considered whether EBITDA or revenue would represent a financial or non-financial variable. Decision. IFRIC members noted that there is current diversity in practice. Given this diversity, IFRIC members agreed not to add the topic to the agenda, on the basis that it would be unable to reach a consensus on a timely basis. Foreign currency instruments exchangeable into equity instruments of the parent entity of the issuer The IFRIC considered a submission in connection with exchangeable instruments issued by a subsidiary of a group that provide holders with rights to convert the instruments into a fixed number of equity instruments of the parent entity of the issuer. Two situations were outlined in the submission: in one the exchangeable instruments are denominated in a currency other than the functional currency of the issuer; in the other the exchangeable instruments are denominated in a currency other than the functional currency of the parent entity of the issuer. The issue is whether the conversion options embedded in the exchangeable instruments should be classified as equity in the consolidated financial statements of the parent. Decision. The IFRIC decided not to take this topic to the agenda. IAS 32 Financial instruments: Presentation – Changes in the contractual terms of an existing equity instrument resulting in it being reclassified to financial liability The IFRIC considered a situation in which an entity makes some substantive amendments to the terms of an existing equity instrument, for example, by inserting a contingent settlement provision. Consequently, the instrument is reclassified from equity to financial liability in accordance with IAS 32. On the date of reclassification, the fair value of the instrument is different from the carrying amount of the previously recognised equity instrument. The submission asked how the liability that arises from the change in the terms of the instrument should be measured at the date of reclassification. Should the liability be measured at: the carrying amount in equity immediately before the reclassification; or at its fair value at the date of reclassification? Decision. The IFRIC decided not to add the topic to the agenda. The rejection note will explain that the liability should be measured at fair value when reclassified, and that the difference between the carrying amount and the fair value should be recognised in equity. IAS 1 Presentation of financial statements - Whether the liability component of a convertible instrument should be classified as current or non-current The IFRIC considered a situation in connection with the presentation of the liability component of a convertible instrument. The submission asked the IFRIC to provide guidance on how the liability component should be presented on the face of the balance sheet. Decision. IFRIC decided not to endorse any view at the current stage, but rather to refer this issue to the Board for clarification. Oral Update on Other Agenda Committee Business IFRIC staff gave a brief update on agenda items that the IFRIC Agenda Committee are reviewing. An issue on classification of SIM cards as inventory or assets is expected to be presented to the IFRIC in September. The Agenda Committee is also reviewing an issue on accounting for catalogues and TV spots. This issue is also expected to be presented to the IFRIC in September. A issue related to hedge effectiveness and assessment on a cumulative basis was noted, but without an indication as to when the issue would be presented to the IFRIC. Scroll down for notes from day 1 of the 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.

7 July 2006: Notes from day 1 of the July 2006 IFRIC meeting
The International Financial Reporting Interpretations Committee (IFRIC) is meeting at the IASB's offices in London on Thursday 6 July and Friday 7 July 2006. Presented below are the preliminary and unofficial notes taken by Deloitte observers at the first day of the meeting.

Thursday 6 July 2006 New Members The Chairman noted that the IASC Foundation Trustees had appointed three new IFRIC members on 5 July 2006: Takatsugu Ochi (present at the meeting), Sara York Kenny and Ruth Picker (neither of whom was able to be present because of prior commitments). He also welcomed Reinhard Biebel as the new representative of the European Commission. Customer Loyalty Programmes Review of text of a Draft Interpretation Rationale for applying paragraph 13 rather than paragraph 19 of IAS 18 The IFRIC concurred with proposed changes to the Draft Interpretation to stress that the basis of the Interpretation was IAS 18 paragraph 13 and its concept of applying the 'revenue recognition criteria to the separately identifiable components of a single transaction.' In addition, the guidance in IAS 18.13 is normative and IAS 18.19 is the exception and applies in those circumstances in which the entity will incur costs in the future as a result of an event outside the control of both it and the customer (e.g., a claim under a warranty). Estimates of fair values of award credits The IFRIC agreed that the Draft Interpretation should not provide detailed guidance on measurement and estimation techniques. Rather, it should establish a principle that an entity should determine the fair value of the consideration received and the fair value of the goods or services delivered and recognise revenue based on the relative fair values of the two. The methods used to determine this allocation should be consistent and should also result in some revenue being allocated to the reward credits. Recognising revenue on one basis and deferring revenue on another would be precluded. Programmes that offer a choice of awards Decision. The IFRIC agreed that the Draft Interpretation should address programmes that offer a choice of awards. There was little discussion and the proposed wording was not available to Observers. Awards supplied by a third-party provider Decision. The IFRIC agreed that revenue should be recognised when either the customer redeems award credits or when a third party assumes the obligation to supply the awards. IFRIC members asked that the Draft Interpretation should give an example of this type of award (for example, a hotel grants airline miles/points). Forfeiture The IFRIC discussed how entities that operate customer loyalty programmes should account for award credits that are forfeited by customers, that is, never redeemed for awards. The IFRIC agreed that the Draft Interpretation should be explicit that an entity should make an estimate of the expected forfeitures of awards as part of the initial allocation of the consideration received (between revenue and the future deliverable). That estimate can be revised (as any other estimate) but that revision does not affect the initial allocation. As agreed earlier in the session, the Draft Interpretation will not provide detailed guidance on how this estimation should be done, but the method chosen should be applied consistently. Exposure Decision. The Chairman polled IFRIC members as to who would object to the issue of a Draft Interpretation based on the Draft Interpretation as presented, amended and supplemented by the decisions reflected above. No IFRIC members intimated an intention to object to the Draft Interpretation. Drafting comments will be taken out of session and the normal 'negative clearance' will be sought from the Board in die course. It is hoped to issue the Draft Interpretation for comment presently. IFRIC D17 – IFRS 2: Group and Treasury Share Transactions The IFRIC discussed the following situations, previously raised in paragraph 6(c)(i) and 6(c)(ii) of D17 Group and Treasury Share Transactions: The parent (or another entity of the same group) directly grants its equity instruments to the employees of a subsidiary; and A subsidiary grants equity instruments of its parent (or another entity of the same group) to its employees. Situations in which the Parent grants options on its shares directly to a Subsidiary's employees or to the Subsidiary, which then delivers them to its employees The IFRIC quickly coalesced around a method (Method 3 in the Observer note) that would result in a 'reasonable allocation of the group charge' being made by the Parent to the Subsidiary. This method ensures that, regardless of the intragroup payment structures that exist, the effects of the transactions are reasonably reflected in profit or loss of the subsidiary that receives services from the employees. Several IFIRC members, while expressing support for the method, also expressed concerns about the possible consequences of this approach on separate financial statements generally. Others noted the concern, but thought that because these schemes were always 'group schemes' and the parent company was actively involved in the scheme, the reasonable allocation approach reflected the substance of the transaction. A subsidiary grants equity instruments of its parent (or another entity of the same group) to its employees The IFRIC was more troubled with extending Method 3 to the second group of transactions, because some of them thought that the approach contravened IAS 39's definitions of a derivative and the accounting prescribed for them in that Standard. Decision. After an extended discussion, it was decided to draft an Interpretation to address the first Issue only. The Interpretation would comment that, in some circumstances, share-based payment schemes would be more appropriately treated as cash-settled. Next steps The staff will bring a draft Interpretation to the next meeting of the IFRIC. IFRIC D12-14: Service Concession Arrangements The staff presented the findings of further research it had conducted to obtain an understanding of how the contractual commitments for operations and maintenance obligations of service concession arrangements work in practice. As a result of this improved understanding, the staff recommended certain changes to the application guidance of the financial asset model set out in D13. Decision. Although the IFRIC disagreed with some of the staff suggestions, it was agreed that the it was necessary to explain when it would be appropriate to use the 'D13' model to repairs and maintenance obligations and that the final Interpretation should include examples of when IAS 37 would apply to such obligations and when the D 13 model would apply. Next steps The IFRIC will next consider proposed illustrations of the bifurcated model and revised examples based on the approaches proposed in D 13 and D 14. At a subsequent meeting(s), the IFRIC will consider the timing of recognition of any intangible assets; the transition date; and whether re-exposure is necessary. It is hoped that, barring the necessity for re-exposure, a final Interpretation would be issued by December 2006. IAS 19 Post-employment Benefits – The effect of a minimum funding requirement on the asset ceiling Review of text of a Draft Interpretation The IFRIC discussed a revised draft of a Draft Interpretation on this topic. The revised draft included changes approved at the May 2006 IFRIC meeting. The detailed drafting was not available to Observers, although the substance of the changes was included in the Observer note. Exposure Decision. The Chairman polled IFRIC members as to who would object to the issue of a Draft Interpretation based on the Draft Interpretation as presented, amended and supplemented by the decisions reflected above. No IFRIC members intimated an intention to object to the Draft Interpretation. Drafting comments will be taken out of session and the normal 'negative clearance' will be sought from the Board in die course. It is hoped to issue the Draft Interpretation for comment presently. >Agenda Proposal: Guidance on Identifying Agency Arrangements The IFRIC, although noting that it did not see evidence that there is currently widespread divergence in this area, agreed to add a project to develop guidance at the level of general principles in IAS 18 on identifying whether an entity is acting as an agent in an agency relationship. At the same time, it noted that, because it was unaware of diversity in practice, the project should not be considered a high priority project. Review of Published Tentative Agenda Decisions IFRS 2 Share-based Payment - Fair value measurement of a post-vesting transfer restriction The IFRIC confirmed its Tentative Agenda Decision with respect to this topic. There was a discussion as to whether this decision would result in the treatment of any restatements necessary as the correction of an error, noting that the topic was raised as the result of guidance issued by a national standard-setter. The IFRIC noted that it was up to entities to determine whether any changes necessary were changes in estimates or other types of restatements (including errors). Decision. It was agreed that the Rejection statement would state that there was 'sufficient authoritative guidance' available in IFRS 2 rather than stating that 'the answer is clear'. It was thought that this would avoid any restatements being treated as errors. IAS 17 Leases - Recognition of contingent rentals Decision. The IFRIC had received three comment letters on its proposed Rejection statement on this topic. The IFRIC agreed that none of the letters fundamentally changed its view that the topic should not be taken to the Agenda. However, the IFRIC did agree: To send a recommendation to the IASB that at the next available opportunity IAS 17 should be clarified to state that contingent rentals should not be included in minimum lease payments for the purposes of income and expense recognition. The Rejection statement should be explicit that the topic referred to the IFRIC addressed income and expense recognition ('straight-lining') only and did not address lease classification. Recommendations from the IFRIC Agenda Committee and the Staff Valuation of electricity derivatives Decision. The IFRIC reached a tentative decision not to add to its Agenda a topic to develop an Interpretation of IAS 39 with respect to the valuation of certain electricity derivatives, for example 'contracts for differences'. The IFRIC noted that the original submission was more in the nature of a request for application guidance rather than interpretive guidance. The Rejection statement would note that IAS 39 already contains a valuation hierarchy (IAS 39.48-.49 and AG69-AG82) and that the guidance in the IASB's forthcoming proposals on fair value measurement would also assist in this area. IAS 11 Construction Contracts/IAS 18 Revenue Allocation of profit in unsegmented contracts This issue arose out of the IFRIC's project on service concession arrangements. In April 2005, the IFRIC noted that "The difference related to revenue recognition on construction contracts that involved different activities but did not meet the conditions in IAS 11 for segmentation. The IFRIC had observed that IAS 11 required gross recognition of revenue and costs (the 'gross approach'), while US GAAP required recognition of a percentage of expected contract profit (the 'net approach'). Arguably, the use of the gross approach (unlike the net approach) could result in the recognition of different profit margins on different activities within an unsegmented contract." The staff was asked to consider whether it was necessary to develop stand-alone interpretive guidance or whether it would be sufficient to include guidance in the service concession Interpretation. The IFRIC agreed that there was sufficient appropriate guidance already in IAS 18 and IAS 11 to determine the appropriate accounting in such circumstances. Click to view Diagram of the Existing Guidance as discussed by IFRIC. They thought the issue too fundamental to place in the service concession arrangement Interpretation. In addition, there were some cross-over issues with customer loyalty programmes. Decision. The IFRIC tentatively agreed not to add the topic to its Agenda. It will consider proposed rejection wording at its next meeting. IFRS 2 Share-based Payment-Incremental Fair Value to Employees as a result of unexpected Capital Restructurings The IFRIC considered a submission addressing a situation in which a sponsoring entity had a capital restructuring (for example, a 1-for-2 share consolidation) subsequent to a grant of share options to its employees. At the time of the grant, the sponsoring entity did not expect to restructure its capital. As a result of the capital restructuring, the fair value of the share options increases significantly. However, the share option plan does not specify whether adjustments should be made to the plan in the event of a capital restructuring. Decision. The IFRIC tentatively decided not to take this topic to its Agenda. In doing so, it noted: The Rejection statement should state that the IFRIC would not expect to encounter situations such as that raised in the submission in normal commercial circumstances (that is, the submission fails the criterion in paragraph 27(a) of the IFRIC Preface). It expected it to be rare for share-based payment plans not to make provision for capital restructurings and that, although the fact pattern in the submission probably represented an abuse, the abuse was not an accounting issue but a corporate governance issue. Economic obligations The IFRIC Chairman briefed the IFRIC on the results of the Board's discussion of economic obligations ('economic compulsion') at its June 2006 meeting and the statement that it issued subsequently in IASB Update. Decision. It was agreed that the IFRIC would include the Board's statement in a proposed Rejection statement in the forthcoming issue of IFRIC Update, together with a statement from the IFRIC that it had decided not to take the topic to its Agenda. The usual comment period would apply. IAS 39 Financial Instruments – Securitisations: Derecognition of Groups of Financial Assets At the May IFRIC meeting the staff was asked to consider the implications of an Interpretation which would align the wording in IAS 39 paragraph 16 with the 'possible intention' of the Board. That request raised two intriguing questions: What was the intention of the Board at the time of writing IAS 39, and How could that intention be applied to the more recent questions that are on the IFRIC agenda (as well as future issues that may arise)? The staff concluded that it would not be possible to ascertain what the intention of the Board actually was without asking the Board directly. Consequently, the IFRIC was asked to approve a reference from the IFRIC to the IASB for clarification. The result of this reference might be that the Board decides that it was best placed to assume responsibility for the topic or that it could give the IFRIC general advice on which it could address the topic and any future securitisation/derecognition issues. The IFRIC agreed with the staff recommendation. 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 July 2006: New education standard on auditor competence
The International Accounting Education Standards Board (IAESB), an independent standard-setting board within the International Federation of Accountants (IFAC), has released a new standard outlining the skills, training, professional values, and attitudes necessary for auditors to perform competently. International Education Standard (IES) 8 Competence Requirements for Audit Professionals applies to all audit professionals, not just the audit engagement partner. It also prescribes specific competence requirements for audit professionals involved in transnational audits.

Effective 1 July 2008, IFAC member bodies will be expected to modify their policies and procedures to ensure that audit professionals meet the requirements of IES 8. These requirements include having advanced level knowledge of audit and financial reporting; relevant information technology knowledge; and the professional skills and professional values, ethics and attitudes expected from audit professionals.

Click for Press Release (PDF 80k).

7 July 2006: New Global Offerings Services newsletter

We have posted the June 2006 Edition of the Deloitte Global Offerings Services Newsletter (PDF 114k). Global Offerings Services is a global team of Deloitte practitioners assisting non-US companies and non-US practice office engagement teams in applying US and International accounting standards (that is, US GAAP and IFRSs) and in complying with the SEC's financial reporting rules. The GOs Newsletter is an update on relevant GAAP, regulatory, and other matters, webcasts, and publications. Past GOs Newsletters are Here.

6 July 2006: Discussion paper on Conceptual Framework
As a first step in their joint project on the Conceptual Framework of financial reporting, the US Financial Accounting Standards Board (FASB) and the IASB have each published and invited comment on a discussion paper setting out their preliminary views on:

• the objective of financial reporting, and
• the qualitative characteristics of decision-useful financial information.

6 July 2006: Deloitte Country Guides and Country Snapshots

Deloitte publishes two series of booklets with extensive information on investment conditions, tax regimes, and regulatory requirements in over 75 countries around the world. They also include information for executives working abroad: Country Guides. Detailing extensive regulatory, tax and human resources information for more than 50 countries worldwide Snapshots. Providing concise facts, figures, economic indicators and country tax rates for more than 75 countries. Newly available Snapshots cover Canada, Finland, Guam, Italy, Lebanon, Netherlands Antilles, Papua New Guinea, and Uzbekistan. You can access these publications at www.deloittecountryguides.com. We also have a permanent link on our Countries page.

6 July 2006: Agenda for July 2006 IASB meeting
The International Accounting Standards Board will hold its July 2006 Board meeting at its offices, 30 Cannon Street, London, on Tuesday through Friday 18-21 July 2006. Presented below is the preliminary agenda for the meeting. Please note that the Board will not meet in August.

18-21 July 2006, London Tuesday 18 July 2006 Amendments to IAS 37 IFRIC Update IFRS 2 – Vesting Conditions and Cancellations Conceptual Framework – Definitions of assets and liabilities Pensions – Agenda decision Insurance Contracts - Phase 2: Unit-linked insurance contracts. Profit or loss could be affected when a unit-linked fund holds investments that are not measured at fair value through profit or loss. Premium presentation. Should an insurer present all premiums as revenue, all premiums as deposit receipts or some premiums as revenue and some premiums as deposit receipts? Wednesday 19 July 2006 (afternoon only) Leases – Agenda decision Process for non-urgent, minor amendments to standards – The Board will discuss a process for making minor amendments to standards. Accounting Standards for Small and Medium-sized Entities - review of the financial instruments section of a revised draft ED Thursday 20 July 2006 Short-term Convergence: Interests in Joint Ventures – Classification of direct and indirect interests in a joint arrangement. Analysis of scenarios. Consolidations – Control Business Combinations II - Continued redeliberations of the proposed revised IFRS 3. Segment Reporting - To discuss the major issues raised by constituents on ED 8 Operating Segments. Revenue Recognition – The Board will consider issues arising from the application of its revenue recognition criterion, which it developed at the April joint meeting with the FASB. Friday 21 July May 2006 (morning only) Related Party Disclosures – Agenda decision Financial Statement Presentation – Application of the working principles: how information might be categorised and displayed in the financial statements (see notes from March 2006 Board meeting).

6 July 2006: Three IFRIC members appointed
The Trustees of the IASC Foundation have appointed three new members of the International Financial Reporting Interpretations Committee (IFRIC). The new members are:

• Sara York Kenny, Principal Accounting Advisor to the International Finance Corporation, World Bank Group
• Takatsugu Ochi, General Manager of Planning and Administration Department, Financial Resources Management Group, Sumitomo Corporation, Japan
• Ruth Picker, Partner, Technical Consulting Group, Ernst & Young, Australia

• Complete List of IFRIC Members.
• Press Release on the Appointments (PDF 57k).
• Background Information about IFRIC.

6 July 2006: Statistics database updated

We have updated our Database of Statistics that, we believe, provide clear evidence of the globalisation of the world's capital markets and of the need for global financial reporting standards. Updates include latest data about cross-border listings on the World Federation of Exchange member exchanges, London, NYSE, and NASDAQ.

5 July 2006: Model annual report for 2005 using 'New Zealand IFRSs'

Deloitte (New Zealand) has published New Zealand Model Annual Report (PDF 1,623k) – a guide to producing an annual report and consolidated financial statements on first-time adoption of New Zealand Equivalents to International Financial Reporting Standards Financial (NZ-IFRSs) for years ending on or after 31 December 2005. The publication includes: an illustrative example of annual financial statements prepared by consolidated entities on first-time adoption of NZ-IFRSs discussion and examples of other matters that would typically be included in an entity's annual report to meet the requirements of section 211 of the Companies Act 1993, New Zealand Stock Exchange Listing Rules, and New Zealand Securities Legislation. You will find a permanent link to this publication, a comparison of NZ-IFRSs and IFRSs, and other information about financial reporting in New Zealand on our New Zealand Page.

5 July 2006: Public sector audit guidelines to be based on ISAs
The International Auditing and Assurance Standards Board (IAASB) and the Professional Standards Committee (PSC) of the International Organization of Supreme Audit Institutions (INTOSAI) have signed a memorandum of understanding that allows the PSC to use the IAASB's International Standards on Auditing (ISAs) as the basis for guidelines on public sector financial audits.

4 July 2006: Use of IFRSs in Yemen
We have created a Yemen Page. Yemen does not have a stock exchange, and there are no domestic accounting standards or accounting regulation. Audit reports in Yemen generally refer to conformity with generally accepted accounting principles without indicating whether that is IFRS or US GAAP or some other framework. Sometimes, IFRSs are used.

4 July 2006: 'Convergent enforcement' of IFRSs in Europe
The Committee of European Securities Regulators has published its Annual Report for 2005 (PDF 2,181k). The report notes that one of CESR's key objectives for 2006 is "facilitating convergent enforcement of IFRSs for all listed companies in Europe". CESR's work in the area of financial reporting in Europe is coordinated by CESR-Fin, a permanent operational group within CESR chaired by John Tiner, Chief Executive of the UK Financial Services Authority. Writing in CESR's 2005 report, Mr. Tiner states:

4 July 2006: John Kellas is reappointed IAASB chair
The Board of the International Federation of Accountants (IFAC) has reappointed John Kellas as Chair of the International Auditing and Assurance Standards Board (IAASB), the body that sets International Standards on Auditing. Mr. Kellas has served on the IAASB since October 2000 and as Chair since January 2004, a position that became full-time on 1 October 2004 of that year. His appointment to a second term, beginning 1 January 2007 and ending 31 December 2008, was endorsed by the Public Interest Oversight Board (PIOB), which oversees the IAASB's activities to ensure that they are properly responsive to the public interest. Click for Press Release (PDF 83k).

4 July 2006: EU Council amends 4th and 7th directives
The Council of the European Union has adopted revisions to the EU's existing directives on the annual and consolidated accounts of European companies. The new directive modifies the 4th and 7th company law directives ('accounting directives' 78/660/EEC and 83/349/EEC), and also the accounting directives for banks (86/635/EEC) and insurance undertakings (91/674/EEC). It establishes collective responsibility of board members for the financial statements and annual reports, enhances transparency in related parties' transactions and off-balance sheet arrangements, and, for publicly traded companies, introduces a requirement for a corporate governance statement. The size thresholds for exempting small and medium-sized entities from specified accounting and auditing rules were also raised. The new directive must be signed by the Presidents of the Council and the European Parliament, and then will take effect 20 days after publication in the Official Journal of the EU. EU member states will then have two years to enact the provisions of the new directive into their national legislation. Click for Press Release (PDF 117k).

3 July 2006: EFRAG meeting dates for 2007

The European Financial Reporting Advisory Group (EFRAG) has announced its meeting dates for 2007 (below). Meeting dates for 2006 and other information may be found on our EFRAG Page. EFRAG Meeting Dates 2007 10-12 January 2007 14-16 February 2007 14-16 March 2007 24-26 April 2007 30-31 May and 01 June 2007 11-13 July 2007 5-7 September 2007 10-12 October 2007 7-9 November 2007 17-19 December 2007

3 July 2006: US SEC and Korea FSC regulatory dialogue

The US Securities and Exchange Commission (SEC) and the Korea Financial Supervisory Commission (FSC) will address accounting and auditing standards as part of an agreed regulatory dialogue between the two agencies. The SEC-FSC dialogue has two main objectives:

• To improve cooperation and the exchange of information in cross-border securities enforcement matters; and
• To identify and discuss regulatory issues of common concern.

• cross-border cooperation and information sharing on enforcement matters;
• accounting and auditing standards;
• corporate governance and internal controls; and
• approaches to regulated entities and market intermediaries.

3 July 2006: Heads Up newsletter on US insurance accounting
Deloitte & Touche LLP (United States) has published a special edition of the Heads Up Newsletter (PDF 83k) summarising the recently issued FASB Invitation to Comment Bifurcation of Insurance and Reinsurance Contracts for Financial Reporting. This project could significantly affect the accounting for certain insurance contracts in the United States. Though FASB's Invitation is not published jointly with the IASB, the IASB does have an Insurance Accounting Project on its agenda. FASB requests comments by 24 August 2006.

2 July 2006: Agenda project pages updated for June 2006 meeting

We have updated the following agenda project pages to reflect the Board's deliberations at the May 2006 IASB meeting:

• Accounting Standards for Small and Medium-sized Entities
• Conceptual Framework
• Fair Value Measurement
• Financial Instruments: Comprehensive Project
• IAS 33 Amendments - Earnings per Share
• IAS 37 Amendments - Provisions
• Insurance Contracts - Phase 2
• IAS 34 Interim Financial Reporting: Interaction with IAS 36 and IAS 39

2 July 2006: IFRIC meeting 6-7 July 2006 will be Webcast

For the first time, a meeting of the International Financial Reporting Interpretations Committee (IFRIC) will be Webcast when the IFRIC meets in London on Thursday 6 July and Friday 7 July 2006. There is no charge for the Webcast service. Registration is required on the IASB's Website. The agenda and running order of the meeting are set out below.

6-7 July 2006, London Thursday 6 July 2006 Introduction, administrative matters, minutes of the May 2006 meeting Customer Loyalty Programmes - review of text of a Draft Interpretation IFRIC D17 - IFRS 2: Group and Treasury Share Transactions IFRIC D12-14: Service Concession Arrangements IAS 19 Post-employment Benefits - The effect of a minimum funding requirement on the asset ceiling – review of text of a Draft Interpretation IAS 18 Revenue – Guidance on identifying agency arrangements IAS 39 Financial Instruments: Recognition and Measurement – Securitisations: Derecognition of groups of financial assets Review of tentative agenda decisions published in previous IFRIC Update IFRS 2 Share-based Payment – Fair value measurement of a post-vesting transfer restriction IAS 17 Leases – Recognition of contingent rentals Friday 7 July 2006 IFRS 2 Share-based Payment – Employee benefit trusts in the individual or separate financial statements of the sponsor IAS 39 Financial Instruments: Recognition and Measurement – Criteria for identifying 'portions' Recommendations regarding requests for IFRIC agenda items Valuation of electricity derivatives IAS 32 Financial Instruments: Presentation – Puts and forwards held by minority interests IFRS 3 Business Combinations Are puts or forwards received by minority interests in a business combination contingent consideration IAS 11 Construction Contracts/IAS 18 Revenue – Allocation of profit in unsegmented contracts SIC 12 Consolidation of Special Purpose Entities – Relinquishment of control IAS 39 Financial Instruments: Recognition and Measurement: Definition of a derivative: – Indexation on own EBITDA or own revenue IAS 32 Financial Instruments: Presentation – Foreign currency instruments exchangeable into equity instruments of the parent entity of the issuer IAS 32 Financial Instruments: Presentation – Changes in the contractual terms of an existing equity instrument resulting in it being reclassified to financial liability IAS 1 Presentation of Financial Statements – Whether the liability component of a convertible instrument should be classified as current or non-current IFRS 2 Share-based Payment – Incremental fair value to employees as a result of unexpected capital restructurings IAS 16 Property, Plant and Equipment – Revaluation of investment properties under construction

1 July 2006: Heads Up newsletter on recent US proposals
Deloitte & Touche LLP (United States) has published the June 2006 issue of the Heads Up Newsletter (PDF 98k) summarising three proposals issued recently by United States standard-setters:

• FASB and AICPA: Invitation to Comment, Enhancing the Financial Accounting and Reporting Standard-Setting Process for Private Companies
• FASB: Proposed FASB Staff Position No. FAS 126-a, Revision to the Definition of a Public Entity to Include an Obligor for Conduit Debt Securities
• GASB: Preliminary Views, Accounting and Financial Reporting for Derivatives