The IASB met on October 25, 2023, to discuss whether to include guidance in the prospective Accounting Standard based on feedback from a survey on the direct (no direct) relationship concept and to redeliberate the proposals in the Exposure Draft Regulatory Assets and Regulatory Liabilities relating to the boundary of a regulatory agreement. The IASB tentatively decided to include in the prospective Accounting Standard guidance on how to account for regulatory returns on an asset not yet available for use that compensate for borrowing costs an entity has capitalized. The IASB also tentatively decided that the prospective Accounting Standard would retain the proposed guidance in the Exposure Draft on rights to renew or cancel a regulatory agreement, compensation for cancellation of a regulatory agreement and on reassessment of and changes to the boundary of a regulatory agreement. Finally, it tentatively decided to include the principles of IFRS 15 that relate to an entity’s right to payment for performance completed to date. An entity would use those principles to help it assess whether there exists an enforceable present right to receive, or an enforceable present obligation to pay, compensation on termination of a regulatory agreement for an amount comprising unrecovered regulatory assets and unfulfilled regulatory liabilities.

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