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AcSB Research Update – Extractive Activities

  • IFRS - AcSB Image

Feb 08, 2019

On February 8, 2019, the Accounting Standards Board (AcSB) published an overview of the results of their research on the accounting challenges faced in the extractive sector.

The AcSB also outlines developments since the International Accounting Standards Board (IASB) Discussion Paper, Extractive Activities, was published in 2010. Their findings are to assist the IASB in identifying topics it should consider as it starts research on extractive activities.

Key research findings include:

  • A weak commodity price environment and pipeline capacity constraints are placing additional pressures on the extractive sector.
  • The decline in commodity prices reduces the profitability prospects and attractiveness of the sector.
  • These pressures have caused a decrease in the number of publicly traded entities as a result of mergers, acquisitions and bankruptcies.
  • Other than that, there have been no significant changes or developments in the Canadian extractive sector since 2010.
  • Many preparers, practitioners and regulators say that there are areas of accounting complexity both within and outside of the scope of IFRS 6.
  • However, non-authoritative guidance on many of these challenges are available, e.g. by CPA Canada Mining and the CPA Canada Oil and Gas Task Forces.

Review the press release and overview on the AcSB's website.

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