March 2018

2017 Changes to Part I – AcSB Due Process – Endorsement Activities

Mar 29, 2018

On March 29, 2018, the Accounting Standards Board (AcSB) released a summary on how new or amended IFRS® Standards make their way into the CPA Canada Handbook – Accounting.

The summary includes an overview of the due process activities they carried out in support of changes made to Part I of the Handbook last year.

Review the summary on the AcSB's website.

2018 IFRS XBRL taxonomy issued

Mar 16, 2018

On March 16, 2018, the IFRS Foundation issued its 2018 IFRS® Taxonomy. The IFRS Taxonomy is a translation of IFRS Standards into XBRL (eXtensible Business Reporting Language).

The IFRS Taxonomy 2018 is consistent with IFRS Standards as issued by the International Accounting Standards Board (the Board) at January 1, 2018 and incorporates amendments made to the IFRS Taxonomy 2017 such as:

  1. Applying IFRS 9 Financial Instruments with IFRS 4, Insurance Contracts (Amendments to IFRS 4), issued in September 2016,
  2. IFRS 17, Insurance Contracts, issued in May 2017, and
  3. Prepayment Features with Negative Compensation (Amendments to IFRS 9), issued in October 2017.

The IFRS Foundation has also published the IFRS Taxonomy Update — Annual Improvements and the IFRS Taxonomy Update — Prepayments Features with Negative Compensation (Amendments to IFRS 9). The IFRS Taxonomy 2018 incorporates the changes resulting from these two updates.

Review the press release and the IFRS Taxonomy 2018 page on the Board's website.

AcSB Insurance Transition Resource Group Meeting Notes – February 1, 2018

Mar 02, 2018

On March 2, 2018, the Accounting Standards Board (AcSB) released a summary of its Insurance Transition Resource Group meeting held on February 1, 2018.

The topics discussed at this meeting include:

  • Boundary of reinsurance contracts held
  • Separation of insurance components of a single insurance contract
  • Boundary of contracts with annual repricing mechanisms
  • Insurance acquisition cash flows paid on an initially written contract
  • Determining quantity of benefits for identifying coverage units
  • Insurance acquisition cash flows when using fair value transition
  • Reporting on other questions submitted to the IASB® Transition Resource Group for IFRS 17, Insurance Contracts

Review the summary on the AcSB's website.

Appointments — AcSOC, AcSB, and PSAB

Mar 21, 2018

On March 21, 2018, the Accounting Standards Oversight Council (AcSOC) announced appointments, as well as retirements and reappointments, to the AcSOC, AcSB and PSAB.

Among the new appointments to the AcSOC is Shelley Brown, FCPA, FCA, ICD.D, Deloitte LLP. She has been appointed as a member for three-year terms ending on March 31, 2021.

Also, Jean-Luc Ostiguy, CPA, CA, Retired Partner, Deloitte LLP, has been appointed to the PSAB as a member for three-year terms ending on March 31, 2021.

Review the complete list on the AcSOC's website.

Companies hurry to adopt new hedge accounting standard

Mar 09, 2018

On March 9, 2018, Accounting Today released an article on how some companies have opted to early adopt the new hedge accounting standard, particularly banks, even though they’re still dealing with other new accounting standards.

The Financial Accounting Standards Board issued its hedging standard last August, making it effective for public companies in 2019 and private companies in 2020, but also allowing for early adoption. The standard refines and expands hedge accounting for both financial risks, such as interest rates, and commodity risks.

Review the full article on Accounting Today's website.

EFRAG publishes discussion paper on the impairment and recycling of equity instruments

Mar 01, 2018

On March 1, 2018, the European Financial Reporting Advisory Group (EFRAG) published a discussion paper "Equity Instruments - Impairment and Recycling" to gather constituents' views on recycling and impairment of equity instruments designated at fair value through other comprehensive income to develop its technical advice to the European Commission.

In the first phase of the project, the European Commission asked EFRAG to collect quantitative data on the current holdings of equity instruments and their accounting treatment and investigate if entities expect that the new accounting requirements will affect their decisions in relation to investment in equity instruments. EFRAG reported its findings from this first phase in January 2018.

In the second phase of the project, the Commission asked EFRAG to provide advice on whether and how the requirements in IFRS 9 on accounting for holdings of equity instruments could be improved. As part of its due process, EFRAG has now published the discussion paper to gather constituents' views on recycling and impairment of equity instruments designated at fair value through other comprehensive income.

EFRAG has not included a preliminary view on the issues explored. Rather, the paper analyses the relevance of recycling in the context of a long-term investment business model and presents arguments on the conceptual relationship between recycling gains and losses on derecognition and impairment. The paper considers how the application problems identified with IAS 39's impairment model for available-for-sale equity instruments could be addressed. It illustrates an impairment model and a revaluation model but does not express a preliminary view as to which, if either, of these two models is preferable.

​Comments on the discussion paper are expected by May 25, 2018.

Review the discussion paper on the EFRAG's website.

FASB proposes changes in accounting for cloud computing costs

Mar 01, 2018

On March 1, 2018, the Financial Accounting Standards Board (FASB) issued a proposed accounting standards update aimed at improving how to account for the costs of implementing cloud computing. Comments are requested by April 30, 2018.

The proposed update would specifically clarify the accounting for implementation costs related to a cloud computing arrangement that is a service contract. It also would provide more disclosures of the implementation costs for internal-use software and cloud computing arrangements.

Review the press release and the exposure draft on the FASBs website.

Hyperinflationary economies - updated IPTF watch list available

Mar 08, 2018

On March 8, 2018, the Centre for Audit Quality (CAQ) released the discussion document "Monitoring Inflation in Certain Countries".

IAS 29 "Financial Reporting in Hyperinflationary Economies" defines and provides general guidance for assessing whether a particular jurisdiction's economy is hyperinflationary. But the IASB does not identify specific jurisdictions. The International Practices Task Force (IPTF) of the Centre for Audit Quality (CAQ) monitors the status of "highly inflationary" countries. The Task Force's criteria for identifying such countries are similar to those for identifying "hyperinflationary economies" under IAS 29.

The IPTF's discussion document for the November 21, 2017 meeting is now available and states the following view of the Task Force:

Countries with three-year cumulative inflation rates exceeding 100%:

  • South Sudan
  • Suriname
  • Venezuela

Countries with projected three-year cumulative inflation rates exceeding 100%:

  • Angola
  • Libya
  • Argentina

Countries where the three-year cumulative inflation rates had exceeded 100% in recent years:

  • Sudan

Countries with recent three-year cumulative inflation rates exceeding 100% after a spike in inflation in a discrete period:

  • Ukraine

Countries with projected three-year cumulative inflation rates between 70% and 100% or with a significant (25% or more) increase in inflation during the current period

  • Democratic Republic of Kongo
  • Egypt
  • Yemen

Review the press release and full list, including exact numbers, detailed explanations of the calculation of the numbers, and observations of the Task Force on the CAQ's website.

IASB publishes revised Conceptual Framework

Mar 29, 2018

On March 29, 2018, the International Accounting Standards Board (the Board) published its revised "Conceptual Framework for Financial Reporting". Included are revised definitions of an asset and a liability, as well as new guidance on measurement and derecognition, presentation and disclosure. The new Conceptual Framework does not constitute a substantial revision of the document as was originally intended when the project was first taken up in 2004. Instead the Board focused on topics that were not yet covered or that showed obvious shortcomings that needed to be dealt with.


Summary of main aspects of the Conceptual Framework

The 2018 Conceptual Framework is structured into an introductory explanation on the status and purpose of the Conceptual Framework, eight chapters, and a glossary:

Chapter Topic
Status and purpose of the Conceptual Framework
1 The objective of general purpose financial reporting
2 Qualitative characteristics of useful financial information
3 Financial statements and the reporting entity
4 The elements of financial statements
5 Recognition and derecognition
6 Measurement
7 Presentation and disclosure
8 Concepts of capital and capital maintenance
Appendix A Glossary

Review our Global IAS Plus page for a summary of the key content of each chapter.

The Conceptual Framework does not have a stated effective date and the Board will start using it immediately.


References to the Conceptual Framework

Together with the revised Conceptual Framework, the Board has also issued Amendments to References to the Conceptual Framework in IFRS Standards. The document contains amendments to IFRS 2, IFRS 3, IFRS 6, IFRS 14, IAS 1, IAS 8, IAS 34, IAS 37, IAS 38, IFRIC 12, IFRIC 19, IFRIC 20, IFRIC 22, and SIC-32. Not all amendments, however update those pronouncements with regard to references to and quotes from the framework so that they refer to the revised Conceptual Framework. Some pronouncements are only updated to indicate which version of the framework they are referencing to (the IASC framework adopted by the Board in 2001, the IASB framework of 2010, or the new revised framework of 2018) or to indicate that definitions in the standard have not been updated with the new definitions developed in the revised Conceptual Framework.

The amendments, where they actually are updates, are effective for annual periods beginning on or after January 1, 2020.


Additional information

The Board also announced that on April 18, 2018, there will be two live web presentations to introduce the revised Conceptual Framework. Please click for more information and registration on the Board's website.


IFRS Foundation reappoints two IFRS® Interpretations Committee members

Mar 02, 2018

On March 2, 2018, the Trustees of the IFRS Foundation announced the reappointment of two IFRS Interpretations Committee members, one of them Robert Uhl, Head of Deloitte's IFRS Centre of Excellence for the United States.

Robert Uhl is US National Director of Accounting Standards. He is also the US leader on Deloitte’s Global IFRS Leadership Team and a member of the Financial Accounting Standard Board’s Emerging Issues Task Force.

The other reappointed member, Jongsoo Han, is a Member of the Korea Accounting Standards Board (KASB) and Chairman of the Korea Institute of CPAs’ Accounting Research Committee.

Review the press release on the International Accounting Standards Board's website.

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