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December 2017 ASAF meeting—agenda papers primary financial statements

  • IFRS - ASAF Image

Nov 20, 2017

On November 20, 2017, the International Accounting Standards Board (IASB) released the agenda papers for the next ASAF meeting on definition of finance income/expenses and better ways to communicate other comprehensive income (OCI).

Here's a summary of staff recommendations:

Definition of finance income/expenses

The staff recommended:

  1. using ‘cash and cash equivalents’ as a proxy for cash and temporary investments of excess cash (‘excess cash’) in the definition of finance income/expenses.
  2. that finance income/expenses consist of the following five line items:
    1. interest income from cash and cash equivalents calculated using the effective interest method;
    2. other income from cash, cash equivalents and financing activities;
    3. expenses from financing activities;
    4. other finance income; and
    5. other finance expenses. 
  3. clarifying the current description of ‘financing activities’ in IAS 7 Statement of Cash Flows using the wording recommended to the IFRS Interpretations Committee by the staff in March 2013.  

Better ways to communicate other comprehensive income (OCI)

The staff recommended:

  1. renaming the two categories in the OCI section of the statement(s) of financial performance as follows:
    1. ‘remeasurements reported outside profit or loss’ (previously OCI items that will not be reclassified subsequently to profit or loss); and
    2. ‘income and expenses to be included in profit or loss in the future’ (previously OCI items that will be reclassified subsequently to profit or loss).
  2. introducing a new subtotal between the two categories called ‘income after remeasurements reported outside profit or loss’.
  3. developing investor education material in the form of case studies that illustrate why it is important for users of financial statements to consider items of OCI in their analysis of companies.

Review the agenda papers and listen to the webcast for this meeting on the IASB's website.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.