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Rate-regulated Activities – IASB

Date recorded:

At its meeting on February 22, 2018, the Board discussed the possible accounting model being developed for activities subject to "defined rate regulation".

The Board tentatively decided that:

  1. the accounting model will use as its unit of account the individual timing differences that create the incremental rights and obligations arising from the regulatory agreement.
  2. the present regulatory right—to charge a rate increased by an amount as a result of past events—meets the definition of an asset in the Conceptual Framework.
  3. the present regulatory obligation—to provide goods or services at a rate reduced by an amount as a result of past events—meets the definition of a liability in the Conceptual Framework.

The Board will discuss proposals for the scope and recognition requirements of the model before deciding whether to publish an Exposure Draft or a Discussion Paper as the next consultation document for the project.

Review the IASB Update and podcast on the Board's Web site.

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