Discount Rates - IDG

Date recorded:

At its meeting on May 14, 2015, the AcSB’s IFRS Discussion Group (IDG) discussed which of the following approaches are consistent with the discount rate requirements in IAS 19: (i) traditional approach; (ii) split discount rate approach; (iii) yield-curve approach; and (iv) mixed approach. The focus of the discussion was to first determine whether an approach other than applying a single weighted average discount rate is permissible under IAS 19. Group members noted that IAS 19 does not appear to preclude the use of alternative approaches. Group members emphasized it is important to look at the underlying details of any model given the potential terminology differences to understand if the calculations are aligned with the requirements in IAS 19 and if the model is being applied consistently from period to period. Given the various channels of work on pensions, the Group recommended not raising this issue to the IASB or the IFRS Interpretations Committee at this time but monitoring the issue for future developments.

Review the IFRS Discussion Group on the AcSB's Web site.

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