The IASB met on September 19, 2023, to discuss transition requirements for the proposed changes to IFRS 3 Business Combinations and IAS 36 Impairment of Assets; and due process steps—including permission to begin the balloting process—for the Exposure Draft.

The IASB tentatively decided to require an entity to apply the proposed amendments to the disclosure requirements in IFRS 3 to business combinations for which the acquisition date is on or after the effective date of the amendments, with earlier application permitted; not to provide first-time adopters with a specific exemption from applying the proposed amendments to IAS 36; and to require eligible subsidiaries to apply the proposed amendments to the prospective IFRS Accounting Standard Subsidiaries without Public Accountability: Disclosures, without restating comparative information, from the effective date of those proposed amendments, with earlier application permitted.

The IASB also tentatively decided to require an entity to apply the proposed amendments to IAS 36 to impairment tests on or after the effective date of the proposed amendments, with earlier application permitted; and not to provide first-time adopters with a specific exemption from applying the proposed amendments to IFRS 3.

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The IASB met on September 19, 2023, to discuss the direction of its project on Business Combinations under Common Control. The IASB discussed feedback on the project direction including from public meetings with the IASB consultative groups and meetings with other stakeholders. The IASB also discussed the staff's analysis of that feedback and initial views on whether to change the project direction; and if so, whether to develop disclosure-only requirements or discontinue the project.

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The IASB met on September 20, 2023, to redeliberate the proposals in the Exposure Draft relating to credit and other risks affecting the estimates of future cash flows arising from a regulatory asset or a regulatory liability and to discuss how to use the responses to a survey on the direct (no direct) relationship concept to develop guidance in the prospective Accounting Standard.

The IASB tentatively decided that the prospective Accounting Standard would retain the requirement proposed in the Exposure Draft about the estimated future cash flows arising from a regulatory asset or a regulatory liability; specify that if an entity bears credit risk, the entity estimates uncollectible amounts considering the net cash flows that will arise from the recovery of regulatory assets and the fulfilment of regulatory liabilities; and allocates the estimates of uncollectible amounts to regulatory assets only; provide no additional guidance on how an entity accounts for credit risk if the entity is compensated for this risk; and demand risk; and retain the requirement proposed in the Exposure Draft that an entity’s estimates of future cash flows arising from a regulatory liability do not reflect the entity’s own non-performance risk.

The IASB tentatively decided that the prospective Accounting Standard would include the direct (no direct) relationship concept to help an entity identify differences in timing arising from the regulatory compensation the entity receives on its regulatory capital base; specify that an entity’s ability to trace differences between the regulatory capital base and the property, plant and equipment at an asset level is a strong indicator that they have a direct relationship; specify that, in the case of service concession arrangements, an entity determines whether the regulatory capital base has a direct (no direct) relationship with the intangible asset that arises from the service concession arrangement; and include examples to illustrate how an entity determines the direct (no direct) relationship using specific fact patterns.

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The IASB met on September 20, 2023, to discuss the project ‘s direction. The IASB tentatively decided not to develop requirements or guidance to disclose information to help users of financial statements (i) understand how an entity accounts for exploration and evaluation expenditure; (ii) compare entities with varying accounting policies for exploration and evaluation expenditure; and (iii) understand the risks and uncertainties of an entity’s exploration and evaluation activities; and not to pursue other suggestions to improve disclosure requirements related to exploration and evaluation expenditure and activities.

The IASB tentatively decided to confirm that the work done in publishing the Discussion Paper Extractive Activities in April 2010 and in this Extractive Activities research project completes the comprehensive review of the accounting for extractive activities envisaged by the IASB when issuing IFRS 6 Exploration for and Evaluation of Mineral Resources; to remove, as part of its next volume of Annual Improvements to IFRS Accounting Standards, the temporary nature of the exemption in IFRS 6 from the application of paragraphs 11–12 of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors; and to retain paragraphs 13–14 of IFRS 6, which set out the circumstances when an entity may change its accounting policies for exploration and evaluation expenditure.

As a consequence of the tentative decisions made in the project, the IASB decided to stop the project and to add to the maintenance project pipeline a project to remove, as part of its next volume of Annual Improvements to IFRS Accounting Standards, the temporary nature of the exemption in IFRS 6 from the application of paragraphs 11–12 of IAS 8.

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The IASB met on September 20, 2023, to discuss its project on Climate-related Risks in the Financial Statements. The IASB discussed whether to generalize the project objective to cover the reporting of financial information about the effects of other uncertainties in addition to those related to climate in the financial statements; the results of research on the nature and causes of stakeholders’ concerns about reporting the effects of climate-related risks in the financial statements; and the potential actions the IASB could take to respond to these concerns.

The IASB decided that the objective of this project is to explore whether and, if so, how targeted actions could improve the reporting of financial information about climate-related and other uncertainties in the financial statements. Because of this decision, the project name is now changed to ‘Climate-related and Other Uncertainties in the Financial Statements’.

The IASB discussed potential actions it could take to respond to stakeholders’ concerns about reporting the effects of climate-related risks in the financial statements. The IASB decided to explore whether to create examples to illustrate how to apply requirements in IFRS Accounting Standards to reporting the effects of climate-related and other uncertainties; to explore clarifying or enhancing requirements in IFRS Accounting Standards in relation to disclosure of information about estimates; to refer to the IFRS Interpretations Committee a question about the circumstances in which an entity recognizes a liability when applying IAS 37 Provisions, Contingent Liabilities and Contingent Assets to climate-related commitments; and to consult with the IFRS Interpretations Committee on questions related to the application of IAS 36 Impairment of Assets to measure value in use when an asset is subject to highly variable future cash flows over an extended period.

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The IASB met on September 21, 2023, to continue its discussions on the project. he IASB tentatively decided to propose amendments to IFRS 12 Disclosure of Interests in Other Entities.

The IASB tentatively decided to propose that an investor disclose the gain or loss from recognizing its share of other changes in its associate’s net assets that change its ownership interest, while it retains significant influence.

The IASB tentatively decided to propose that an investor that has entered into a contingent consideration arrangement disclose on obtaining significant influence in an associate (i) the amount recognized as part of the cost of the investment; (ii) a description of the arrangement and the basis for determining the amount of the payment; (iii) an estimate of the range of outcomes (undiscounted) or, if a range cannot be estimated, that fact and the reasons why a range cannot be estimated. If the maximum amount of the payment is unlimited, the investor shall disclose that fact and for each subsequent reporting period until the investor collects or settles the contingent consideration or it is cancelled or expires (i) any changes in the recognized amounts, including any differences arising upon settlement; (ii) any changes in the range of outcomes (undiscounted) and the reasons for those changes; and the valuation techniques and key model inputs used to measure the contingent consideration.

The IASB tentatively decided to propose that an investor disclose its gains or losses on transactions to its associates. The IASB tentatively decided to propose that an investor disclose a reconciliation between the opening and closing carrying amount of its investments in associates, to meet the new disclosure objective.

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The IASB met on September 21, 2023, to discuss stakeholder feedback on the Exposure Draft Amendments to the Classification and Measurement of Financial Instruments, which proposes amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures.

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