AcSB response – Onerous contracts
Apr 26, 2019
On April 26, 2019, the Accounting Standards Board (AcSB) released its response to the International Accounting Standards Board’s (IASB) Exposure Draft, Onerous Contracts – Cost of Fulfilling a Contract (Proposed amendments to IAS 37).
This exposure draft seeks to specify the costs an entity should include in determining the “cost of fulfilling” a contract for the purpose of assessing whether a contract is onerous.
The AcSB supports the modified retrospective approach, but disagrees with the IASB’s decision not to allow the option to apply full retrospective application in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. They recommend allowing the use of full retrospective application for entities as long as those entities have the information available to do so without the use of hindsight.
Review the press release on the AcSB's website and the full letter on the IASB's website.
