The IFRS Taxonomy 2021 is consistent with IFRS Standards as issued by the IASB at January 1, 2021, including those issued but not yet effective.

The IFRS Taxonomy 2021 also incorporates the six updates made to the IFRS Taxonomy in 2020 reflecting amended IFRSs and providing new common practice elements.

Review the press release and IFRS Taxonomy 2021 page on the IASB's website.

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

The IASB has developed the proposed standard 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.

The letter agrees with the proposal to extend the relief related to COVID-19 related rent concessions and suggests factors to consider when selecting the extension timeframe. The letter also suggests that the transition provisions provide more flexibility.

Review the full letter.

Here are the new appointments from Deloitte Canada:

AcSOC appointments

• Shelley Brown, FCPA, FCA, ICD.D, Partner (ret.), Deloitte Canada

AcSOC announces new PSAB appointments

Appointed as a member for a three-year term ending on March 31, 2024:

• Jennifer Teoh, CPA, CA, Senior Manager, Accounting and Reporting Advisory, Deloitte Canada

Review the announcement on the AcSOC's website.

Review the statement on the SEC's website.

Review the letter on the SEC's website.

Mr. Hoogervorst began his speech with some quips about departing presidents and his intention to leave peacefully. In fact, he noted, there was no need for an armed insurrection of angry national standard-setters as his designated successor, Andreas Barckow, is the former Chair of the German standard-setter and thus really understands what national standard-setters need from the IASB - an insider so to say.

Mr. Hoogervorst then looked back over his ten years as Chairman. He noted he was truly proud of what the IASB has achieved during that time: completing reforms following the global financial crisis and delivering major improvements to financial instruments accounting, to revenue recognition and to lease accounting — often in the face of fierce lobbying. In his second term, the IASB focused on improvements to presentation. Not all projects of that phase are finished yet, but all of them delivered or promise progress at making disclosures more relevant.

While mentioning big standards and adoption of IFRSs around the world, Mr. Hoogervorst could not help but comment on the adoption of IFRS 17 in Europe and that some parties still hope to limit the scope of the annual cohorts requirement that are intended to insure that contracts cannot continue contributing to profits long after they have expired. His questions were:

• Is it really worth it?
• Will European insurers really look good if they apply a carve-out that most investors will view as a short-cut that distorts performance?
• Is it in the interests of the industry itself to lose the full benefits of applying the same standard across the world?

A bracket around Mr. Hoogervorst's speech were the crises at the beginning at the end of his chairmanship. He joined  the IASB with little experience with accounting at a time when the accounting for financial instruments came under attack during the financial crisis. He noted that people were pointing the finger at accounting when the blame was really much closer to home. At that time he was convinced that the criticism of accounting was a typical case of shooting the messenger. Mr. Hoogervorst noted that during the COVID-19 crisis and recession the state of the global economy is even more perilous that ten years earlier with debt exploding around the world. He stated that he would not be surprised if accounting comes under pressure again, as it did in 2008, when the economic stress that has been building up finally erupts. But, he noted, that is exactly the point when proper accounting matters the most.

Concluding his speech Mr. Hoogervorst thanked the national standard setters and stressed that IFASS was a wonderful example of what can be achieved when highly skilled people from around the globe work together to solve common challenges, which was even more impressive given the anti-globalization backdrop of the last five years where a politically expedient solution is often valued above the right accounting solution. He asked the standard setters to continue to stand up for independent standard-setting and to give his successor and his team the same support they have given him in the last decade.

Review the transcript and a recording of the speech on the IASB's website.

During the meeting, the staff presented an analysis of the feedback received that showed that almost all respondents supported the Board's proposals in the exposure draft. The only change the staff recommended as a result of its analysis of the feedback was an additional explanatory transition paragraph.

Main points raised during the Board's discussion were the fact that IFRS 16 is not a new standard anymore so that companies should be able to comply with the requirements; the pandemic is still ongoing; there are differences in magnitude of and general situation in connection with the pandemic around the world; there is a difference between public health and economy; the lack of comparability would be continued; setting an end date to the practical relief will always be arbitrary; does there need to be an end date at all when the reference is clearly to COVID-19 related rent concessions?

When called to vote, the Board

• agreed with the conclusions the staff had drawn and decided to finalize the proposal in the exposure draft with the one additional explanatory transition paragraph proposed (10 in favour, one absent);
• agreed with with the conclusion that the amendment to IFRS 16 does not require re-exposure (12 in favour, one absent); and
• was satisfied that it has complied with the applicable due process requirements and that it has undertaken sufficient consultation and analysis to begin the balloting process for the amendment to IFRS 16 and thus gave permission to do so (12 in favour, one absent).

The same Board member that dissented from publishing the exposure draft also dissented from publishing the final amendments. In addition, one Board member who did express serious doubt when the exposure draft was published, but did not dissent then, now dissented as well.

The staff expects to finalize the amendment by the end of this month so that it can be issued on March 31, 2021 with an effective date of April 1, 2021.

In addition, see the detailed notes taken by Deloitte observers for the meeting.

Review the press release on the IASB's website.

Background

In May 2020, the IASB issued Covid-19-Related Rent Concessions (Amendment to IFRS 16). The pronouncement amended IFRS 16, Leases to provide lessees with an exemption from assessing whether a COVID-19-related rent concession is a lease modification. On issuance, the practical expedient was limited to rent concessions for which any reduction in lease payments affects only payments originally due on or before June 30, 2021.

Since lessors continue to grant COVID-19-related rent concessions to lessees and since the effects of the COVID-19 pandemic are ongoing and significant, the IASB decided to extend the time period over which the practical expedient is available for use.

Changes

The Changes in Covid-19-Related Rent Concessions beyond 30 June 2021 (Amendment to IFRS 16) amend IFRS 16 to

1. permit a lessee to apply the practical expedient regarding COVID-19-related rent concessions to rent concessions for which any reduction in lease payments affects only payments originally due on or before June 30, 2022 (rather than only payments originally due on or before June 30, 2021);
2. require a lessee applying the amendment to do so for annual reporting periods beginning on or after April 1, 2021;
3. require a lessee applying the amendment to do so retrospectively, recognizing the cumulative effect of initially applying the amendment as an adjustment to the opening balance of retained earnings (or other component of equity, as appropriate) at the beginning of the annual reporting period in which the lessee first applies the amendment; and
4. specify that, in the reporting period in which a lessee first applies the amendment, a lessee is not required to disclose the information required by paragraph 28(f) of IAS 8.

Effective date

The amendment is effective for annual reporting periods beginning on or after April 1, 2021 (earlier application permitted, including in financial statements not yet authorized for issue at the date the amendment is issued).

Dissenting opinion

The final amendment includes a joint dissenting opinion by Board members Nick Anderson and Zachary Gast. They voted against publication of the final amendments noting that when the practical expedient was initially offered, its application was limited to a very specific timeframe. Extending the period during which the practical expedient is available does further impede comparability between lessees that apply the practical expedient and those that do not. They also note that support from users of financial statements for the original amendment was based on limiting the practical expedient to a specific time frame. In addition, they highlight that lessees are no longer applying IFRS 16 for the first time.

Additional information

• IASB press release