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April 2018

AcSB Annual Plan – 2018-2019

Apr 02, 2018

On April 2, 2018, the Accounting Standards Board (AcSB) released its Annual Plan where they explain what’s in store for 2018-2019 and the activities they will be working on that forward their Strategic Plan’s vision, mission, and objectives.

These activities include: enhancing the relevance of financial information, support IFRS® Standards implementation, forwarding private enterprise and NFPO projects, and much more.

Review the Annual Plan on the AcSB's website.

AcSB Exposure Draft – Accounting Policy Changes (Proposed amendments to IAS 8)

Apr 17, 2018

On April 17, 2018, the Accounting Standards Board (AcSB) issued its Exposure Draft that corresponds to the International Accounting Standards Board’s (IASB) Exposure Draft on this topic. Stakeholders are encouraged to submit their comments by July 27, 2018.

Entities sometimes voluntarily change an accounting policy to reflect explanatory material included in agenda decisions published by the IFRS® Interpretations Committee. The proposed amendments lower the impracticability threshold for retrospective application of such changes, to one based on entity-specific cost-benefit considerations.

The AcSB would like input from Canadian respondents on the following additional question regarding the proposed amendments:

  • The IASB has developed the proposed amendments in accordance with its due process for application around the world. Assuming the Exposure Draft proposals are finalized and approved by the IASB in accordance with its due process, do you think that the proposals are appropriate for application in Canada? If not, please specify which aspects of the proposals, and what circumstances, make the accounting requirements proposed in the Exposure Draft inappropriate.

Review the Exposure Draft on the AcSB's website.

AcSB Standard-setting Due Process Manual

Apr 20, 2018

On April 20, 2018, the Accounting Standards Board (AcSB) released a revised due process manual that provides a clear explanation of their IFRS® Standards endorsement and domestic standard-setting activities.

The AcSB Standard-Setting Due Process Manual outlines their rigorous set of procedures to develop and adopt standards.

The due process is based on the following principles:

  • Transparency: conducting their standard-setting process in a transparent manner.
  • Consultation: considering the perspectives of those affected by Canadian financial reporting standards.
  • Accountability: analyzing the potential effects of its proposals on affected parties and explaining the rationale for their decisions when developing or changing a standard in material published with exposure drafts and final standards. They are also directly accountable to the Accounting Standards Oversight Council.

Review the due process manual and due process procedures on the AcSB's website.

An Update on Hedge Accounting: A Q&A With Deloitte’s Jon Howard

Apr 02, 2018

On April 2, 2018, Financial Executives International released a Q&A with Deloitte’s Jon Howard, where he discussed hedge accounting early adopters, foreign currency hedging, spot purchases, and more.

The new hedge accounting standard (ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities) takes effect for fiscal years beginning after December 15, 2018 for public companies and for fiscal years beginning after December 15, 2019 for private companies.

In the Q&A, Jon states that he's getting a lot of questions and doing a lot of consultations on foreign currency hedging. And that's basically any multi-national, anybody who's got operations overseas, whether it's purchases or sales, that they are going to do in another currency. What's really popular right now, is hedging subsidiaries, your net investment and subsidiaries in Europe, and Great Britain, and Japan.

He's also seeing a lot of foreign currency hedging right now. Not only entities that have been doing it and just want to apply the new standard, but entities that have not been doing it, wanting to adopt the new standard.

Review the full Q&A on FEI's website.

Article "Investor Perspectives" on insurance accounting published

Apr 10, 2018

On April 10, 2018, the International Accounting Standards Board (the Board) issued the latest issue of "Investor Perspectives." In this edition, Darrel Scott (IASB® board member) discusses IFRS 17 as accounting to reflect economics.

This issue features:

  • Darrel Scott's perspective on the new information about insurers’ financial performance that will be available when IFRS 17 is applied;
  • the unit of account and why the unit of account in IFRS 17 matters to investors, and
  • illustrative examples.

Review the press release and article Investor Perspectives article on the Board’s website.

FASB staff proposes taxonomy implementation guide on revenue and taxonomy improvements related to its proposal on collaborative arrangements

Apr 27, 2018

On April 27, 2018, the Financial Accounting Standards Board (FASB) staff issued a proposed financial reporting taxonomy implementation guide, “Revenue From Contracts With Customers (Including Remodeling of Revenue and Cost of Revenue Presentation in the Statement of Income),” and proposed taxonomy improvements related to the proposed Accounting Standards Update (ASU), “Collaborative Arrangements (Topic 808): Targeted Improvements.”

The proposed revenue implementation guide provides “examples to help users of the Taxonomy understand the modeling for revenue from contracts with customers under FASB Accounting Standards Codification Topic 606 and the remodeling of revenue and cost of revenue presentation in the statement of income.”

Comments on the proposed implementation guide are due by May 30, 2018.

Comments on the proposed taxonomy improvements to the proposed ASU on collaborative arrangements are due by June 18, 2018.

Review the guide on the FASB's website.

How FASB’s new ASC 842 transition option will affect lessees and investors

Apr 11, 2018

On April 11, 2018, Accounting Today released an article where they discuss the new optional transition method for lessees under the ASC 842 lease accounting standards. The new method would provide an alternative to the modified retrospective transition method.

The new transition option allows companies to forgo the comparative reporting requirements entirely. Instead, they would “recognize a cumulative-effect adjustment to the opening balance of retained earnings” at their adoption date rather than on January 1, 2017, according to FASB. In other words, now companies only have to transition to the new standards at the effective date, instead of having to apply the new standards for two years prior to the effective date.

This article reviews how the new transition method will affect two of the main stakeholders of the new lease accounting standards: the lessees and the investors.

Review the full article on Accounting Today's website.

IASB® Vice-Chair discusses IFRS 9

Apr 23, 2018

On April 23, 2018, the IASB Vice-Chair Sue Lloyd issued a paper which recaps the requirements in IFRS 9 for equity investments and the effects on long-term investment.

In her paper, she discusses the following:

  • IFRS 9 on long-term investment.
  • Reporting value changes in profit or loss gives better information about value creation over time.
  • Recycling can provide a confusing presentation of performance.
  • Debt investments are different.
  • Prohibiting recycling avoids complexity related to impairment.
  • Developing a new impairment model for equity investments is not an easy task.
  • Prevalence of available for sale equity investments applying IAS 39.

Review Ms. Lloyd’s paper on the International Accounting Standards Board’s website.

IASB® Vice-Chair reappointed for second term

Apr 26, 2018

On April 26, 2018, the Trustees of the IFRS Foundation have reappointed Sue Lloyd for a second term as Vice-Chair of the International Accounting Standards Board (the Board).

Ms. Lloyd’s second term will begin on January 1, 2019 and will last for five years.

Review the press release on the Board’s website.

IFRS Foundation Monitoring Board publishes work plan

Apr 19, 2018

On April 19, 2018, the IFRS Foundation Monitoring Board, responsible for the oversight of the IFRS Foundation, published its 2018-2019 work plan.

The Monitoring Board's planned activities are organized into two sections:

  • Reviewing the Trustees’ oversight of the International Accounting Standards Board (the Board)
    • review and comment on the Trustees ́ plan for the review of the Board's due process arrangements
    • continue the dialogue with the Trustees on accounting matters of broad public interest for consideration by the Board
  • Monitoring and conferring with the Trustees on their responsibilities
    • continue its ongoing dialogue with Trustees on the efforts to strengthen the governance framework of the IFRS Foundation
    • follow up of the IFRS Reputation research report
    • discuss the progress and results of the IFRS Foundation’s exercise to identify and evaluate its operational risks
    • continue to review the adequacy and appropriateness of the Trustees’ arrangements for the IFRS Foundation’s funding
    • participate and provide input and help to the IFRS Foundation nomination and approval process for Trustee candidates, including the Chair

Review the press release and the work plan on the Board's website.

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