Go to Chronology for:

• 2008 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2007 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2006 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2005 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2004 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2003 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2002 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2001 – Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
• 2000 – Dec (IASPlus website launched December 2000)

31 March 2008: Stay Tuned Online – IFRS and UK GAAP updates

The Deloitte London IFRS Centre of Excellence is running a series of hour-long Internet-based financial reporting updates, aimed at helping finance teams keep up to speed with IFRS and other financial reporting issues. Each update lasts no more than an hour, and sessions are held three times a year, at the end of March, July and November. We intend to make a recording of each session available on IAS Plus for a period of at least four months from the date of the presentation. The second in the series was held on Thursday 27 March 2008.

31 March 2008: From Financial Director – 'Seeing stars, changing stripes'

"Once anathema to American authorities, US companies are now sure to adopt IFRS, making them a truly global set of accounting standards." This is the lead in to a story in the 26 March 2008 issue of Financial Director. The article discusses a range of issues surrounding the use of IFRSs by United States companies. Here is the Link to the Article on Financial Director's website. Isobel Sharp, audit partner in Deloitte (United Kingdom) and president of the Institute of Chartered Accountants of Scotland, is quoted:

28 March 2008: New Global Offerings Services newsletter

We have posted the March 2008 Edition of the Deloitte Global Offerings Services Newsletter (PDF 208k). 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, with hyperlinks to source material. Past GOs Newsletters are Here.

27 March 2008: Discussion Paper on employee benefits

The IASB has published for comment a Discussion Paper (DP) Preliminary Views on Amendments to IAS 19 Employee Benefits. The DP represents the first step in a comprehensive Project on accounting for post-employment benefit promises. This step is limited in scope to the following issues: The deferred recognition of some gains and losses arising from defined benefit plans (currently IAS 19 allows multiple options for deferring recognition) Presentation of defined benefit liabilities Accounting for benefits that are based on contributions and a promised return Accounting for benefit promises with a 'higher of' option

Therefore, the DP focuses on improvements to IAS 19. In the longer term, the IASB intends to work with the US FASB towards a common standard on post-employment benefit promises. Because that project will take many years to complete, the Board concluded that short-term improvements are needed to provide users with better information about post-employment obligations. The Board intends to review the responses to this paper, modify or confirm its preliminary views, and then develop an exposure draft of amendments to IAS 19 for public comment.

27 March 2008: Agenda for SME Working Group meeting

The IASB's Small and Medium-sized Entities Working Group will meet on Thursday and Friday, 10-11 April 2008 at the The Grange Holborn Hotel (Orion Suite), 50-60 Southampton Row, London WC1B 4AR. The agenda for the meeting is shown below. Click for Project Information.

26 March 2008: New Deloitte Guide to IFRS 5

The Deloitte IFRS Global Office has published an IAS Plus Guide to IFRS 5 Assets Held for Sale and Discontinued Operations (PDF 813k, 76 pages, March 2008). Since issuance of IFRS 5 in 2004, various practical application issues have arisen – principally because the guidance in the Standard is not always clear as to how certain transactions should be accounted for and how the requirements of IFRS 5 interact with those of other Standards. This guide, in addition to providing detailed summaries and explanations of the requirements of IFRS 5, includes supplementary guidance and examples based on Deloitte's experience with the Standard. It summarises the latest IFRS thinking and the evolving literature – including on issues such as partial disposals of subsidiaries, and the impact of the disclosure requirements of other Standards. Appendices provide a comparison with US GAAP and a checklist of IFRS 5's presentation and disclosure requirements. Our IFRS Publications Page has permanent links to this and many other Deloitte IFRS publications.

25 March 2008: IFAC's 2008 auditing, assurance, and ethics handbook
The International Federation of Accountants (IFAC) has released its 2008 Handbook of International Auditing, Assurance, and Ethics Pronouncements. The handbook can be downloaded free of charge in PDF format from the IFAC Website. Print copies can be purchased for US$150 plus shipping. The handbook includes all pronouncements on auditing, review, other assurance, and related services issued by the IAASB as of 1 January 2008. It also includes the IFAC Code of Ethics for Professional Accountants, issued by the International Ethics Standards Board for Accountants, along with new definitions for 'firm', 'network', and 'network firm'. Click for Press Release (PDF 35k).

25 March 2008: US SEC – next steps toward mutual recognition

The US Securities and Exchange Commission has announced a series of actions it intends to take to further the implementation of the concept of mutual recognition for high-quality regulatory regimes in other countries. Click for SEC Announcement (PDF 38k). Here is an overview:

25 March 2008: Agenda project pages updated

We have updated the following IASB agenda project pages to reflect the discussions and decisions at the IASB's meeting on 11-14 March 2008.

• Annual Improvements to IFRSs - 2007
• Extractive Industries (Research Project)
• Fair Value Measurements
• IAS 39: Exposures Qualifying for Hedge Accounting
• IFRS 1: Transitional Issues Faced by Jurisdictions Expected to Adopt IFRSs in Coming Years [new agenda project page created]
• Financial Statement Presentation
• Post-employment Benefits
• IFRS for Small and Medium-sized Entities

23 March 2008: IASB Webcast on employee benefits Discussion Paper
On 27 March 2008 the IASB will release its Discussion Paper (DP) on post employment benefits titled Preliminary Views on Amendments to IAS 19 Employee Benefits. On that day, Stephen Cooper, Member of the IASB, will introduce the DP in a live Web presentation from 12:00pm to approximately 12:30pm GMT. Click here for More Information and Registration Details on the IASB website.

21 March 2008: Two publications from Deloitte Czech Republic

Deloitte Czech Republic has published IFRS model financial statements and an IFRS presentation and disclosure checklist, both for 2007 and in the Czech language. You can download them using the links below and also from our Model Financial Statements Page and also from our Czech Republic Page:

• IFRS Model Financial Statements 2007 (PDF 1,123k)
• IFRS Presentation and Disclosure Checklist 2007 (PDF 1,480k)

21 March 2008: Deloitte Canada Countdown IFRS transition newsletter
Deloitte Canada has released the second issue of a new Countdown IFRS transition newsletter, to provide a snapshot of where we are now as far as IFRS is concerned – both in Canada and in Deloitte. This issue of Countdown focusses on the initial stages of IFRS implementation to help Canadian companies determine their priorities. Articles cover the transition journey: where are we now?; IFRS implementation planning; conversion activities; conference activities (including a 14 April 2008 webcast on IFRSs in Canada); and IFRS impacts beyond financial reporting. Click to download:

• Countdown Newsletter - English (PDF 238k)
• Countdown Newsletter - French (Compte à Rebours) (PDF 360k)

20 March 2008: Discussion Paper on financial instruments

The IASB has published for comment a Discussion Paper (DP) on Reducing Complexity in Reporting Financial Instruments. The DP examines the main causes of complexity under IFRSs today – such as "many alternatives, bright lines, and exceptions that often obscure the underlying principles". The DP concludes that the long-term solution is a single measurement principle for all financial instruments within the scope of a standard, and explains why "fair value seems to be the only measurement attribute that provides relevant information for all types of financial instruments". However, many issues and concerns must be addressed before a general fair value measurement requirement could be introduced. Consequently, the paper suggests possible intermediate approaches that would improve and simplify measurement and hedge accounting requirements relatively quickly – including any or a combination of:

• Amending the existing measurement requirements in IAS 39, for instance, by reducing the number of categories of financial instruments
• Replacing the existing IAS 39 measurement requirements with a fair value measurement principle and some optional exceptions to fair value measurement
• Simplifying hedge accounting

19 March 2008: Group cash-settled share-based payment transactions
Deloitte has submitted a Letter of Comment (PDF 153k) on the IASB's Exposure Draft IFRS 2: Group and Treasury Share Transactions – Group Cash-settled Share-based Payment Transactions. The Exposure Draft responds to requests for guidance on how a group entity that receives goods or services from its suppliers (including employees) should account for the following arrangements (referred to by the IASB as group cash-settled share-based payment transactions):

• Arrangement 1: The entity's suppliers will receive cash payments that are linked to the price of the equity instruments of the entity
• Arrangement 2: The entity's suppliers will receive cash payments that are linked to the price of the equity instruments of the entity's parent

18 March 2008: Summary of issues not added to IFRIC agenda is updated

We have updated our Summary of Issues Not Added to IFRIC's Agenda to reflect the IFRIC's final decision at its March 2008 meeting not to add the following topic to its agenda. Our summary now includes over 130 issues: IAS 7 – Classification of Expenditures as Investing or Operating

18 March 2008: Notes from the IASC Foundation Trustees' meeting

The Trustees of the IASC Foundation (IASCF) held a public meeting on Monday 17 March 2008 in London. Presented below are the preliminary and unofficial notes taken by Deloitte observers at the meeting. Among other things, the Trustees agreed to publish an Invitation to Comment (ITC) on the first phase of the 2008 Constitution Review. The ITC will propose: creation of a new Monitoring Group that would approve IASCF Trustees and expansion of the IASB from 14 to 16 members.

London, 17 March 2008 Report of the IASC Foundation Chairman Gerrit Zalm gave a brief overview of his activities since the last Trustees' meeting in January 2008. Together with Phil Laskawy, Vice-Chair, he noted that there had been a productive series of meetings in the United States. Constitution Review The IASC Foundation staff introduced a staff draft of Proposals and Issues for Constitution Review, which outlined the two parts of the proposed review of the IASCF Constitution: Part A Specific Proposals for Constitutional Changes and Part B, which is intended to provide a broader opportunity to comment other aspects of the IASCF Constitution. The discussion centred on Part A. There are two principal changes proposed by the Trustees in Part A: the introduction of a Monitoring Group and increasing the size of the IASB to sixteen members. IASCF staff noted that the Monitoring Group was being proposed as a way of putting in place 'structured contacts' with public authorities with a legitimate interest in accounting standard setting. The IASCF Chairman stated that the Monitoring Group was being proposed as a way of providing 'democratic legitimacy' to the organisation while preserving the IASB's independence. Almost all Trustees participated in the discussion. Almost all were critical of issuing Part A and Part B together. One Trustee warned the staff not to underestimate the stress that Part A would unleash, nor to underestimate the careful communication that would be necessary to explain why the Trustees had decided on the proposals over other alternatives possibly available to it. There was a high degree of scepticism and distrust in the market: about key players and stakeholders and the IASCF/IASB. Consequently, it would be important to prepare the ground carefully. After some debate, it was decided to issue Part A alone and to proceed with other constitutional issues once the comment period had concluded. Several Trustees were concerned, and had heard similar concerns voiced in constituent meetings, about the influence of the proposed Monitoring Group on the independence of the IASCF and the IASB, especially independence from special pleadings and political interference. The mandate and/ or Terms of Reference of the Monitoring Group would be crucial. In addition, there were concerns that the Group would add another layer of oversight that would confuse rather than enhance the oversight of the IASCF. In addition, if the Group was seen as too powerful, the role and calibre of the Trustees could be compromised. After discussion, the general mandate of the Monitoring Group was agreed to similar to: The Monitoring Group shall be responsible for the approval of all Trustees to fill vacancies caused by routine retirement or other reason. In approving such selection, the Monitoring Group shall be bound by the criteria set out in [Constitution] Sections 6 and 7. The Trustees shall develop a nominations process in conjunction with the Monitoring Group and shall manage that process. The Trustees shall consult with international organisations as set out in Section 7. A staff proposal that the Monitoring Group be able to recommend candidates was rejected; their role should be limited to approval alone. The proposed composition was also examined. It is likely that the proposed Monitoring Group would be composed of: four members of the International Organization of Securities Commissions (IOSCO), represented by the Chairman of the Japan Financial Services Agency, the Chairman of the US Securities and Exchange Commission, the chair of the IOSCO Emerging Markets Committee, and the chair of the IOSCO Technical Committee*, the responsible member of the European Commission [currently the Commissioner for Internal Market] the managing director of the International Monetary Fund, and the president of the World Bank *when the Chairman of the Japanese FSA or the US SEC also chairs the Technical Committee, another member of the Technical Committee (Deputy Chair) would sit on the Monitoring Group. The Monitoring Group would require a super-majority of five to approve appointments of Trustees. Some Trustees were concerned that a bloc of 'IOSCO + the EU' would be created, potentially over-ruling constituencies represented by the IMF and World Bank. Another Trustee noted with a degree of concern that six of the proposed seven seats represented interests of the OECD countries and that 150 other jurisdictions were represented by the IMF. The absence of other 'interested' market regulators (such as the Basel Committee or the International Association of Insurance Supervisors) was also noted. There was no substantive discussion of the proposed changes to the composition of the IASB. However, it was noted that the suggested introduction to the Invitation to Comment would address why the Trustees thought that an increase in the size of the Board was necessary and desirable. The IASCF staff noted the several criticisms and suggestions made by Trustees. The staff will circulate a revised draft to the Trustees out of session, prior to issuing the Invitation to Comment later in April 2008. The comment period will be 90 days. Report of the Due Process Oversight Committee The Trustees received a report from the chairman of the Trustees' Due Process Oversight Committee. The committee will include a summary report in the IASC Foundation's annual report and include a more comprehensive report on its activities on the Foundation's Website. The focus of the committee in 2008 would be, in particular, the standard-setting process at the IASB; and the effectiveness of working groups. Report from the IASB Chairman The IASB Chairman presented a report of the IASB's activities and the status of its projects. He highlighted that the IASB was being encouraged to accelerate its work on consolidation, fair value measurement guidance and derecognition in light of the sub-prime crisis. The Board was adapting the way it worked to make it more responsive and better able to make steady progress on agenda issues, including better use of Board advisors to assist the staff in developing detailed proposals. At the IASB Chairman's invitation, the IFRIC Chairman presented a brief report, noting that the IFRIC had cleared its backlog of issues and was now working on a manageable number of issues. He suggested that the relatively low number of requests for interpretations being handled by the IFRIC suggested that constituents were becoming familiar with the principles in IFRS. Report from the SAC Chairman The SAC Chairman gave a brief report of the February SAC meeting, noting in particular that the Council had expressed strong reservations about the apparent heavy weighting of securities regulators on the proposed Monitoring Group. Review of Long-term Funding of the IASC Foundation The IASC Foundation gave a very brief report on the current state of the ongoing efforts to secure a stable long-term funding base for the Foundation. The weakness of the US dollar and current market turmoil were not helping the organisation to resolve this issue. Currently, the IASCF had secured only just over £13 million of the £16 million it is seeking. There were positive developments in Canada, where the Canadian Securities Administrators were hopeful that a broad, market-based funding system could be implemented; the accounting profession was also interested in contributing. In Europe, the focus of the IASCF is turning to smaller Member States now that the major EU economies have funding strategies in place, or nearly so. The staff noted that contributions from South-East Asia were conspicuous by their absence; however discussions were ongoing in Singapore and other jurisdictions in the region would be addressed later. XBRL The Trustees received an update on developments with respect to the XBRL IFRS Taxonomy. The XBRL staff noted a first draft of the IFRS Taxonomy 2008 had been submitted to the XBRL Quality Review Team in February as planned and, so far, no significant quality issues had been identified. The Taxonomy will be exposed for public comment by the end of March 2008 for a 60-day comment period. The meeting continued in non-public session.

18 March 2008: Agenda for Insurance Working Group meeting
The IASB Insurance Working Group will meet on Tuesday and Wednesday 1 and 2 April 2008 at the Crowne Plaza London – The City, 19 New Bridge Street, London. The agenda for the meeting is:

17 March 2008: EITF Snapshot for March 2008

We have posted the March 2008 edition of EITF Snapshot (PDF 126k) summarising the 12 March 2008 meeting of FASB's Emerging Issues Task Force. EITF Snapshot, published by Deloitte & Touche LLP (USA), enables readers to identify relevant topics and to understand quickly the meeting's outcome. Past issues can be downloaded Here.

16 March 2008: Notes from day 4 of the March 2008 IASB meeting

The International Accounting Standards Board held its March 2008 meeting at the IASB's offices, 30 Cannon Street, London on Tuesday to Friday 11-14 March 2008. Click here to go to the Preliminary and Unofficial Notes Taken by Deloitte Observers at the Meeting.

14 March 2008: Notes from day 3 of the March 2008 IASB meeting

The International Accounting Standards Board held its March 2008 meeting at the IASB's offices, 30 Cannon Street, London on Tuesday to Friday 11-14 March 2008. Click here to go to the Preliminary and Unofficial Notes Taken by Deloitte Observers at the Meeting.

13 March 2008: Notes from day 2 of the March 2008 IASB meeting

The International Accounting Standards Board held its March 2008 meeting at the IASB's offices, 30 Cannon Street, London on Tuesday to Friday 11-14 March 2008. Click here to go to the Preliminary and Unofficial Notes Taken by Deloitte Observers at the Meeting.

13 March 2008: SEC financial reporting advisory panel will meet
The US Securities and Exchange Commission's Advisory Committee on Improvements to Financial Reporting (ACIFR) will hold an open meeting on 13 and 14 March 2008 in San Francisco. The meeting will include three panels that will discuss the 'developed proposals' that the ACIFR published on 14 February 2008 as part of their Progress Report (PDF 989k) to the Commission (see our News Story of 16 Feb 2008). The three panels at the upcoming meeting will cover:

• Panel One – Restatements and Materiality and Discussion of Developed Proposals 3.1, 3.2, and 3.3.
• Panel Two – Professional Judgment and Discussion of Developed Proposal 3.4.
• Panel Three – XBRL and Discussion of Developed Proposal 4.1.

13 March 2008: Post-employment benefits added to March agenda

Post-employment Benefits has been added to the agenda for the IASB meeting on Friday 14 March 2008. Click here for the Complete Agenda for this week's Board meeting.

12 March 2008: Updated EFRAG endorsement status report
The European Financial Reporting Advisory Group (EFRAG) has updated its report showing the status of endorsement, under the EU Accounting Regulation, of each IFRS, including standards, interpretations, and amendments. Click to download the Endorsement Status Report as of 12 March 2008 (PDF 104k). Currently, the following IASB pronouncements have not yet been endorsed for use in Europe:

• IFRS 2 Share-based Payment: Vesting Conditions and Cancellations
• IFRS 3 Business Combinations (2008)
• IAS 1 Presentation of Financial Statements (revised September 2007)
• IAS 23 Borrowing Costs (revised March 2007)
• IAS 27 Consolidated and Separate Financial Statements (2008)
• IAS 32 Amendments for Puttable Instruments and Obligations Arising on Liquidation
• IFRIC 12 Service Concession Arrangements
• IFRIC 13 Customer Loyalty Programmes
• IFRIC 14 IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements, and their Interaction

12 March 2008: Notes from day 1 of the March 2008 IASB meeting

The International Accounting Standards Board held its March 2008 meeting at the IASB's offices, 30 Cannon Street, London on Tuesday to Friday 11-14 March 2008. Click here to go to the Preliminary and Unofficial Notes Taken by Deloitte Observers at the Meeting.

11 March 2008: IASC Foundation XBRL Update
The XBRL team of the IASC Foundation has published the March 2008 IASCF XBRL Update (PDF 135k). The newsletter provides an update on the XBRL-enablement of IFRSs around the world. This issue has news about IFRS-XBRL internationally and from a number of jurisdictions, including Belgium, Europe, India, Ireland, Israel, Japan, Singapore, and United States. There is also information about the IFRS XBRL taxonomy and upcoming events.

11 March 2008: IASC Foundation appoints three Trustees

Three new Trustees have been appointed to the International Accounting Standards Committee Foundation, under which the IASB operates. The appointments are for terms of three years, renewable once:

• Robert Glauber, retired chairman and chief executive officer, NASD (the private sector regulator of the US securities market), and former Under Secretary of the Treasury for Finance, United States
• Pedro Malan, former Finance Minister and former president of the Central Bank of Brazil, and currently chairman of the board of Unibanco
• Luigi Spaventa, former chairman of the Commissione nazionale per le societa e la borsa (Consob) and former Minister of the Budget, Italy

9 March 2008: Deloitte's Global Tax Alerts

Our global tax alerts, prepared by Deloitte professionals around the world, provide timely commentary and analysis on tax developments affecting cross-border transactions. You can find Links to Download Deloitte's Global Tax Alerts here. On that page, also, you may subscribe to receive these alerts by email.

9 March 2008: IFRIC agenda pages are updated
We have updated the following IFRIC agenda issues pages to reflect the discussions and decisions at the meeting of the International Financial Reporting Interpretations Committee on 6 March 2008:

• IAS 18 – Real Estate Sales
• IAS 21 – Hedges of a Net Investment in a Foreign Operation

9 March 2008: Reminder about upcoming comment deadline on IFRS 2/IFRIC 11 revision

We remind you that 17 March 2008 is the deadline for responding to the IASB Exposure Draft Proposed Amendments to IFRS 2 and IFRIC 11: Group Cash-settled Share-based Payment Transactions, which was published on 13 December 2007.

8 March 2008: Changes in ownership of a subsidiary after control is obtained
One of the more controversial issues in the IASB's recently completed amendments to IAS 27 Consolidated and Separate Financial Statements was how to account for changes in ownership of a subsidiary after control is obtained. During its deliberations, the IASB considered six methods that were being used in practice and reached the following decisions:

• Partial disposal of an investment in a subsidiary while control is retained. This is accounted for as an equity transaction with owners, and gain or loss is not recognised.
• Acquiring additional shares in the subsidiary after control was obtained. This is accounted for as an equity transaction with owners (like acquisition of 'treasury shares'). Goodwill is not remeasured

8 March 2008: IFAC survey on public sector performance reporting
The International Federation of Accountants (IFAC) is inviting professional accountants and others who work in the public sector to complete an online survey on the ways in which public sector entities set objectives, measure performance, and report on results. The survey is part of a project to help professional accountants in business and others in evaluating and improving performance measurement systems. The survey, which takes 10-15 minutes to complete, can be accessed online at www.ifac.org/publicsectorperformancesurvey. Responses are requested by 30 April 2008. Click for Press Release (31k).

7 March 2008: Notes from the March 2008 IFRIC meeting

The International Financial Reporting Interpretations Committee (IFRIC) met at the IASB's offices in London on Thursday 6 March 2008. Presented below are the preliminary and unofficial notes taken by Deloitte observers at the meeting. The IFRIC completed its work in one day, and the planned second day of the meeting was not held.

6 March 2008 D22 Hedges of a Net Investment in a Foreign Operation – Preliminary discussion of comprehensive example At the January 2008 IFRIC meeting, the IFRIC discussed the comments received on its Draft Interpretation D22 Hedges of a Net Investment in a Foreign Operation. As a result of the deliberations, the staff was asked to provide a comprehensive example to confirm some of the principles underlying the draft Interpretation. The principles the staff tried to demonstrate were: The same risk can be hedged only once in the group The amount of net investment to be hedged cannot be duplicated A parent entity can hedge a net investment it holds indirectly Where the hedging instrument is held has no effect on hedge effectiveness The consolidation method (direct vs. indirect) does not affect hedge effectiveness The nature of the hedging instrument (cash instrument or derivative) has no effect on hedge effectiveness The staff presented various scenarios of net investment hedges involving cash instruments or derivatives to illustrate the principles. The examples contained the necessary calculations and journal entries in detail. One IFRIC member noted that the examples are meant to prove the principles, as the spreadsheets were set up using those principles. The IFRIC discussed some points using the spreadsheets in depth. Method of consolidation Some IFRIC members were particularly concerned with the assumption that the direct method of consolidation is the correct one and other methods must be adjusted to result in the same figures as the direct method. The chairman told IFRIC members that the Interpretation does not prescribe any method of consolidation but reflects the standards as currently applicable. The staff noted that the question does not deal with the consolidation procedure itself but with effectiveness testing. Overhedging and hedging the same risk twice It was also confirmed that an entity cannot hedge the same risk twice, and some designations/designated amounts would not be valid as they would result in overhedging. One member noted that this would normally not occur in practice as it would also make no sense to overhedge from an economic perspective. Location of the hedging instrument Some IFRIC members highlighted that the method of consolidation could affect the amounts recognised if the hedging instrument is not held within the (sub-)group containing the hedged item (that is, the net investment). Recycling The discussion then switched to the issue of recycling once the net investment or the entity containing the hedging instrument is disposed of. It was noted that this could lead to practical implications and complications, as the amounts in the respective foreign currency translation reserve must be identifiable to allow the correct timing of recycling that results from assuming IAS 39 overrides IAS 21 when it comes to hedge accounting. Some members expressed concerns over the theoretical foundation and the practical application of this approach. The chairman noted that it would not be in the scope of this Interpretation to provide guidance on this issue as this would be a general hedge accounting issue. Some members still did not seem to be convinced. The IFRIC continued its debate on the issues of the method of consolidation and recycling. While there seemed to be agreement that the Interpretation should not prescribe the method of consolidation, some members asked the staff to include words as a caveat to remind entities that they would have to track the amounts in the foreign currency translation reserve relating to hedge accounting, which could be challenging in large and complex group structures. One member also cited possible transitional issues. Another IFRIC member believed implementing the IFRIC approach correctly could be a huge task for some entities. The IFRIC also discussed which examples should go into the final Interpretation as illustrative examples, but did not make a final decision. The staff was also asked to align the example that currently is contained in the draft Interpretation. Other issues raised by commentators The staff also asked the Board to confirm its preliminary conclusions on certain issues raised by commentators to the draft Interpretation. Could a parent entity apply hedge accounting in its separate financial statements? How should the hedged amounts be accounted for? Yes, but that would be a different type of hedge (for example, a fair value hedge). No further clarification is required. The IFRIC agreed. How should an entity account for the ineffectiveness resulting from a decrease in a net investment value during the term of hedge? All ineffectiveness will be recognised in profit or loss. No exception exists for net investment hedges. Such an ex post overhedge would result in ineffectiveness. No further clarification is required. The IFRIC agreed. Should the transitional requirements be clarified? Some commentators asked for clarification on the transitional provision with regard to applying the Interpretation prospectively. The staff proposed to amend the transitional paragraph as follows: "...when first applying the Interpretation. If an entity had designated a transaction as a hedge of a net investment but the hedge does not meet the conditions for hedge accounting in this Interpretation, the entity shall apply IAS 39 to discontinue prospectively that hedge accounting." The IFRIC agreed. Is an intra-group loan defined by IAS 21 paragraph 15 in the scope of this interpretation? Could such an intra-group loan be a part of the net investment? Yes, this is obvious from the Standard. No further clarification is required. The IFRIC agreed, however one member questioned if this really was the question the commentator asked as it was so obvious. Does a hedge relationship designated at a lower group level require hedge documentation also at the higher group levels in order for the lower level hedge to qualify for hedge accounting at any higher level? The IFRIC had a lengthy discussion on this issue, notably if an entity would be required at a higher level to 'unhedge', that is, explicitly state that it does not want to continue hedge accounting coming from a lower level in the group. The IFRIC finally agreed that this is out of the scope of this interpretation as it would be general guidance on how to document hedging relationships. Accordingly, the IFRIC agreed with the staff recommendation not to provide further clarification. Should the interpretation include the reason the hedging instruments may not be held by the foreign operation that is being hedged? No, as this is would allow the net investment to hedge itself as the instrument is part of the net investment. The IFRIC agreed. Then the staff asked the IFRIC whether it agreed with the staff view that the following questions are addressed by the examples presented. One member expressed concerns as the examples would not be contained in the final Interpretation. How should an entity account for various fact patterns such as: a foreign operation is held jointly by two intermediate parents with different currencies a combination of instruments is held by one or several entities within the group to hedge one exposure Parent A holds subsidiaries B (100%) and C (70%) and B holds 30% of C, could B's 30% interest qualify as part of the hedged item in A's consolidated financial statements? Should the interpretation indicate that the location of hedging instrument should have no effect on the amounts actually deferred in equity as an effective hedge? Should the interpretation further clarify possible differences in the amounts of the foreign currency translation reserve caused by the method of the consolidation? The IFRIC agreed not to address these issues in the final Interpretation. Way forward The staff was asked to amend the draft Interpretation in the light of this meeting's discussions and integrate selected examples. The staff will return at the May IFRIC meeting with a new draft of the Interpretation for clearance by IFRIC. D21 Real Estate Sales – Redeliberations The IFRIC discussed a revised draft interpretation reflecting the decisions made at the January 2008 meeting (Agenda Paper 3C available on the IASB website). As requested by the IFRIC the staff presented a flowchart illustrating the consensus of the revised draft interpretation (Section 2 of Agenda Paper 3B available on the IASB website). The discussion was mainly based on the flowchart rather than the revised draft interpretation and focussed on the following topics: Identifying the real estate component of the underlying agreement Transfer of control and significant risks and rewards as construction progresses Identifying the real estate component of the underlying agreement For agreements with multiple components, the flowchart gives guidance on how to split the identifiable components in order to separate the real estate sale component from the sale of other goods and services. This part of the flowchart corresponds to paragraph 7 of the revised draft Interpretation. In addition, reference is made to IFRIC 12 and IFRIC 13 with regard to the allocation of the consideration to the components identified. Some IFRIC members expressed the view that detailed guidance on multiple component sales was not within the scope of the project and that any interpretation should focus on the accounting treatment of the real estate sale component only. There seemed to be a consensus that this part of the flowchart should be condensed by just mentioning that separate components need to be identified and referring to the general principles for multiple component sales in existing IFRSs. Transfer of control and significant risks and rewards as construction progresses The flowchart goes on to address the accounting treatment of the real estate sale component. This part of the flowchart corresponds to paragraphs 8 to 13 of the revised draft interpretation. According to the revised documents presented the definition of a construction contract in accordance with IAS 11 is met 'when the buyer is able to specify the major structural elements of the design of the real estate before construction begins and/or specify major structural changes once construction is in progress' (corresponds to the indicator in paragraph 9(a) of D21). The staff presented two views on the accounting treatment when this criterion is not met but 'the seller transfers to the buyer control and the significant risks and rewards of ownership of the work in progress in its current state as construction progresses' (corresponds to the indicator in paragraph 9(b) of D21). View 1: Even though the definition of a construction contract is not met the seller applies IAS 11 to the real estate sale component. View 2: The seller applies IAS 18 because the real estate sale is a continuous sale of goods. Revenue and costs are recognised by reference to the stage of completion, that is, paragraphs 22-35 of IAS 11 are applied in analogy. The staff noted that view 2 was developed in response to comments received by constituents that paragraph 9(b) of D21 goes beyond the requirements of IAS 11. Some IFRIC members raised the concern that the term continuous sale of goods establishes a new concept that is not covered by current IFRSs. One IFRIC member noted that this is a unit of account issue and that it seems odd that every single piece of the real estate (such as a brick) is a unit of account. Other IFRIC members responded that view 2 is the better approach because the criteria for a sale in accordance with IAS 18 are indeed met on a continuous basis. In addition, these IFRIC members considered the 'fallback' into IAS 11 under view 1 to be a technically inferior solution. One observing Board member was of the opinion that such an interpretation of IAS 18 would not be inappropriate. Finally, a majority of IFRIC members supported view 2. The staff noted that the adoption of view 2 may require additional disclosures because guidance in IAS 11 is applied in analogy for a sale in accordance with IAS 18, a standard that has less restrictive disclosure requirements compared to IAS 11. The IFRIC directed the staff to draft such disclosure requirements for discussion at the next meeting. Way forward The IFRIC asked the staff to revise the draft interpretation and the flowchart taking into account the decisions made at this meeting. The revised documents will be discussed at the May 2008 meeting. The IFRIC postponed the decision on whether the flowchart should be an integral part of the final interpretation. Review of Tentative Agenda Decisions published in November 2007 and January 2008 IFRIC Updates IAS 37 Provisions, Contingent Liabilities and Contingent Assets – Deposits on returnable containers The IFRIC was asked for guidance on the accounting for deposits received for returnable containers. In November 2007 the IFRIC published a tentative agenda decision proposing not to add the item to its agenda. In January 2007 the IFRIC reaffirmed that decision, but could not agree on the wording of the agenda decision. The IFRIC discussed a revised tentative agenda decision proposed by the staff at this meeting. While there seemed to be agreement not to add the item to the agenda, some members continued to be concerned with the wording of the agenda decision. Specifically, they were concerned that the proposed wording (for example, 'the seller has the right to force return') could be interpreted as guidance while the staff made clear those were meant to be examples only. It was agreed to change the wording to avoid providing application guidance and publish the agenda decision. IAS 7 Statement of Cash Flows – Classification of Expenditures as Investing or Operating In January 2008 the IFRIC discussed a possible agenda item regarding the criteria for classifying expenditures as 'operating' or 'investing' in the statement of cash flows. The original submission focused on exploration and evaluation activities, but the staff concluded this could be extended on many situations. The IFRIC tentatively agreed not to add the item to the agenda, but refer it to the Board, as IAS 7 was considered ambiguous in this respect. The tentative agenda decision also contained a recommendation to the Board that classification in the statement of cash flows should follow recognition, that is, only expenditure for an asset recognised in the statement of financial position qualifies for classification as 'investing' in the statement of cash flows. The IFRIC received two comment letters expressing disagreement with the content of the proposed agenda decision. The IFRIC discussed what their recommendation to the Board should be (if any). Some IFRIC members were of the view that an exception in IAS 7 should be created for IFRS 6 expenditures and hence, not dealing with the broader issue. Others were of the view that nothing should be recommended. In response to that, the Chairman reminded IFRIC members that if IFRIC refers anything to the Board, the Board expects IFRIC to make a recommendation (as it would ask this question anyway). The IFRIC agreed that the wording as proposed in the published tentative agenda decision should be kept and published as a final agenda decision. Staff Recommendations for Tentative Agenda Decision IAS 19 Employee Benefits – Settlements At the January 2008 meeting, the IFRIC discussed a possible agenda item on how payments of benefits under a defined benefit plan are to be accounted for and if such payments represented settlements in the IAS 19 meaning. The payments in question arise when plan participants have an option to receive a lump sum payment instead of ongoing payments. The staff originally concluded that such payments would fall under the settlement notion in IAS 19 and that this would be in line with US GAAP. However, US GAAP provides for a materiality threshold for settlement treatment (that is, below this threshold the entity has an option not to treat the payment as a settlement) while IAS 19 does not, which would in practice lead to divergence. Further staff research showed that there is a consistent practice under IFRS of not treating such payments as settlements. Requiring this treatment would have material practical consequences. Due to the threshold under US GAAP and many preparers in the US using this threshold in practice, the treatment under IFRS and US GAAP is already consistent in most cases. Therefore, although there is theoretical divergence from US GAAP, in practice it does not exist. Classifying such payments as settlements mandatorily would in fact lead to divergence unless IFRS would also introduce a threshold. The IFRIC therefore decided not to add the item to its agenda on the basis that it expects no divergence in practice. However, there will be no reference to the outcome of the IASB'S project on pensions. Administrative Session – IFRIC Work in Progress The IFRIC Co-ordinator updated the IFRIC on the current working plan of the IFRIC. It was noted that the IFRIC's project on derecognition of financial instruments is halted due to staff shortage. The IFRIC Co-ordinator also noted that the staff plans to prepare a paper on 'regulatory assets/liabilities' for consideration as an agenda item. The draft Interpretations D21 Real Estate Sales and D22 Hedges of a Net Investment in a Foreign Operation will be brought back at the May IFRIC meeting while the comment letter analyses for draft Interpretations D23 Distributions of Non-cash Assets to Owners and D24 Customer Contributions will be discussed at the July IFRIC meeting. Finally, the tentative agenda decision on IAS 19 Employee Benefits–Settlements (see above) will be reviewed at the May IFRIC 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 March 2008: Agenda for IASC Foundation trustees meeting

The Trustees of the IASC Foundation will hold a public meeting on Monday 17 March 2008 from 10;00am to 16:30pm at the Crowne Plaza London - The City, Bridewell Suite, 19 New Bridge Street, London EC4V 6DB. The agenda is as follows:

London, 17 March 2008 Report of the Chairman of the Trustees Constitution Review Proposals and Actions Report of the Due Process Oversight Committee Report of the IASB Chairman Report of the SAC Chairman Review of long-term financing initiative Update on XBRL activities

6 March 2008: Updated survey on extended use of IFRSs in European Union

Since 2005, the European Union Accounting Regulation has required that European companies listed in a European securities market must use IFRSs to prepare their consolidated financial statements. The Regulation gave EU member states the options to:

• Require or permit IFRSs for unlisted companies
• Require or permit IFRSs in parent company (unconsolidated) financial statements
• Permit companies whose only listed securities are debt securities to delay IFRS adoption until 2007
• Permit companies that are listed on exchanges outside of the EU and that currently prepare their primary financial statements using a non-EU GAAP (in most cases this would be US GAAP) to delay IFRS adoption until 2007.

6 March 2008: IASB's 2008 Bound Volume is published

The IASB has published International Financial Reporting Standards 2008 – the English language Bound Volume containing the official consolidated text of all authoritative IASB pronouncements approved for issue at 1 January 2008. This includes the revised IFRS 3 Business Combinations and amended IAS 27 Consolidated and Separate Financial Statements, which were issued in mid-January. BV 2008 (ISBN: 978-1-905590-54-4) has 2,752 pages and sells for £60 plus shipping, with discounts for students, educators, and low and middle income countries. The main changes in the 2008 edition as compared to last year's Bound Volume are:

• a revised IAS 1 Presentation of Financial Statements
• a revised IFRS 3 Business Combinations
• a revised IAS 23 Borrowing Costs
• an amended IAS 27 Consolidated and Separate Financial Statements
• two new Interpretations:
  • IFRIC 13 Customer Loyalty Programmes
  • IFRIC 14 IAS 19 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction
• amendments to IFRS 2 Share-based Payment
• amendments to other IFRSs resulting from these pronouncements
• the IFRIC Due Process Handbook

6 March 2008: Deloitte New Zealand Accounting Alert

Deloitte New Zealand has published the March 2008 New Zealand Accounting Alert (PDF 120k). Topics covered are listed below. You will find links to past New Zealand Accounting Alerts Here.

• Revised Standards change the accounting for business combinations
• NZ IAS 32 and NZ IAS 1 amended for puttable financial instruments and obligations arising on liquidation
• Amendment of IFRS 2 Share-based Payment clarifies vesting conditions and cancellations
• Revised NZ IAS 1 changes the presentation of financial statements
• Draft interpretations address distributions of non-cash assets to owners and customer contributions

5 March 2008: Accounting Roundup – February 2008

We have posted the February 2008 Edition of Accounting Roundup (PDF 332k) published by Deloitte & Touche LLP (USA). Topics covered in this issue include:

4 March 2008: eIFRS available to IAAER faculty and student members
The International Association for Accounting Education and Research (IAAER) has signed an agreement with the IASC Foundation that offers very affordable access to eIFRS for IAAER members who are accounting educators and students. eIFRS is the electronic consolidated edition of the IASB's International Financial Reporting Standards (including International Accounting Standards and Interpretations) and accompanying documents (including Exposure Drafts and Discussion Papers). IAAER membership (US$25 for faculty and US$20 for students) allows access to eIFRSs via the IAAER site. There is also a group membership price for an entire university. Normal subscription price for eIFRS is £200 (about US$400). For 2008, eIFRS access via IAAER is completely without additional charge. Click for:

• IAAER Announcement about eIFRS (PDF 15k)
• Link to IAAER Website

3 March 2008: IASB's Insurance and SME Working Groups will meet
Two IASB Working Groups will meet in April, as follows:

• Insurance Working Group: Tuesday and Wednesday 1-2 April 2008 (at the Crowne Plaza Hotel London - The City, 19 New Bridge Street, London)
• IFRS for SMEs Working Group: Thursday and Friday 10-11 April 2008 (at the Grange Holborn Hotel, 50-60 Southampton Row, London)

1 March 2008: We comment on the IASB's proposed amendments to IFRS 1

Deloitte has submitted comments on the IASB's revised Exposure Draft of proposed amendments to IFRS 1 on Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate. The revised ED was published on 13 December 2007. Under the proposal:

• Entities, in their separate financial statements, would be allowed to use a 'deemed cost' option for determining the cost of an investment.
• That 'deemed cost' could be either fair value (determined in accordance with IAS 39) or the carrying amount under previous national standards.
• The 'deemed cost' option to would apply to jointly controlled entities and associates as well as subsidiaries.
• A new parent would be required to measure cost using the carrying amounts of the existing entity at the date when the new parent is formed.

1 March 2008: Agenda for March 2008 IASB meeting

The International Accounting Standards Board will hold its March 2008 meeting at the IASB's offices, 30 Cannon Street, London on Tuesday to Friday 11-14 March 2008. The meeting is open to public observation and will be webcast. The tentative agenda is shown below.

11-14 March 2008, London Tuesday 11 March 2008 (afternoon only) Financial Statement Presentation – Income taxes Annual Improvements Project – 2007 Wednesday 12 March 2008 IFRS for Small and Medium-sized Entities (SMEs) IFRS 1: First time adoption of International Financial Reporting Standards – Transitional issues faced by jurisdictions expected to adopt IFRSs in coming years IFRIC Update Thursday 13 March 2008 IAS 39: Financial Instruments Recognition and Measurement – Responses to ED on exposures qualifying for hedge accounting Fair Value Measurement – Whether the fair value measurement project should have a working group or other type of specialist advisory group Extractive Activities Research Project – Definitions of reserves and resources Friday 14 March 2008 (morning only) Extractive Activities Research Project Post-employment Benefits [topic added to agenda 12 March 2008]