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Part I - IFRS

FRC publishes thematic review findings of IFRS 9, IFRS 15, and IAS 36 company disclosures

Oct 10, 2019

On October 10, 2019, the UK Financial Reporting Council (FRC) published three thematic reviews to help companies improve the quality of their corporate reporting in relation to IFRS 9 "Financial Instruments", IFRS 15 "Revenue from Contracts with Customers" and the impairment of non-financial assets.

The reports analyze the disclosures in a sample of companies’ reports and provide examples of better practice.

The FRC concluded that IFRS 15 disclosures could be improved especially with respect to

  • improving the descriptions of accounting policies and ensuring that these are tailored to their own particular circumstances; and
  • providing more detailed information about the judgements significantly affecting the amount and timing of revenue.

In connection with IFRS 9 the FRC found that there was still room for companies to improve disclosures by

  • analysing the credit quality of trade receivables by non-banking companies; and
  • providing details of the indicators of a significant increase in credit risk particularly by the smaller banks.

As regards IAS 36 and the impairment of non-financial assets, the FRC encourage companies to pay greater attention to:

  • providing relevant information around significant judgements and key assumptions made in estimating the recoverable amount of assets and cash-generating units;
  • explaining the sensitivity to changes in key assumptions, where reasonably possible changes could give rise to impairment of goodwill or material further adjustments to already-impaired assets. 

Review the following additional information on the FRC's website:


Updated IASB work plan — Analysis

Oct 01, 2019

On October 1, 2019, the International Accounting Standards Board (the Board) updated its work plan following its September 2019 meeting.

Below is an analysis of all changes that were made to the work plan since our last analysis on September 3, 2019.

Standard-setting projects

  • No changes

Maintenance projects

Research projects

  • SME Implementation Group draft Q&A — project has disappeared from the work plan
  • Extractive activities — the review of research is now expected in the first half of 2020 (previously fourth quarter of 2019)
  • Goodwill and impairment — a discussion paper is now expected in the first quarter of 2020 (previously fourth quarter of 2019)

Other projects

  • 2020 Agenda Consultation — newly added to the work plan, a request for information is expected in the first half of 2020
  • IFRS Taxonomy Update — Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7) — newly added to the work plan, a proposed IFRS Taxonomy Update is expected in October 2019

The revised IASB work plan is available on the Board's website.

IASB Chairman opens WSS meeting

Sep 30, 2019

On September 30, 2019, the International Accounting Standards Board (IASB) released the opening remarks of IASB Chairman Hans Hoogervorst delivered at the World Standard-Setters (WSS) meeting held in London.

The focus of Mr. Hoogervorst's speech was the IASB's work programme for 2020, which will see three exposure drafts, two discussion papers, and three requests for views.

On individual projects, Mr. Hoogervorst spoke about

  • Primary financial statements. The IASB plans to publish an exposure draft at the end of 2019. The IASB is looking at introducing new subtotals in the income statement, is looking at improving discipline around management performance measures, and wants to improve disaggregation.
  • Goodwill and impairment. The IASB plans to publish a discussion paper in February 2020. While the IASB feels that the impairment model is not great, they are not sure whether any of the alternatives are better. By publishing a discussion paper, the IASB is hoping for new evidence and insights.
  • Rate-regulated activities. The IASB will publish an exposure draft in the first half of 2020. The IASB has developed an accounting model that will improve the information to investors about what rights and obligations a company has and is looking for feedback whether they have got the model right.

The IASB is also going to consult on a revised Management Commentary Practice Statement, on proposals on business combinations under common control, on whether the IFRS for SMEs should be updated to reflect changes in full IFRSs, and on the future agenda of the IASB.

Review the full transcript of Mr. Hoogervorst's speech on the IASB's website.

Chairman of the Trustees believes IASB needs to be prepared for sustainability

Sep 30, 2019

On September 30, 2019, the Chairman of the IFRS Foundation Trustees, Erkki Liikanen, spoke at the WSS meeting about his impressions after one year as Chairman and about three issues he believes the IFRS Foundation must look out for: its gains, consistent application, and sustainability.

Mr. Liikanen began his speech by describing the three tasks the IFRS Foundation has (governance, responsibility for strategy, oversight) and noted that the Foundation is there to “ defend the independence of the IASB”. He called the history of the IASB a short, but successful one with IFRS having become the de facto global language of financial reporting.

With that Mr. Liikanen turned to the three issues that he sees as the future task of the IFRS Foundation. Firstly, he said, the Foundation must protect its gains in times of  geopolitical tensions, increasing protectionism, and globalization. He cautioned that “the IFRS Foundation is not immune against pressure”. He also noted that the Foundation cannot sit back and live on its successes but must work to make sure that IFRSs continue to be the global standard in uncertain times in order to continue to maintain the full confidence of the investors. In this context he described the IFRS Foundation as the “custodian of the IFRS product”.

Mr. Liikanen then turned to the question of consistent application. He especially noted that in this area the IASB and the national standard-setters need to work together. While, as he said, the IASB can operate alone, it needs everybody else for support. And, as he said earlier, the national standard-setters really impressed him by the level of engagement and level of expertise. So, Mr. Liikanen concluded, for consistent application and the success of IFRS the Foundation always needs to keep an open ear and ask: “What can we do more?”

Mr. Liikanen concluded his speech by turning to the subject of sustainability, an issue investors increasingly ask for. They want pure financials “and more”, which would translate into the usual numbers plus environmental impact and long-term impact. So what would be the role of the IFRS Foundation in this? He noted that it is very difficult to follow the different systems. He said he had come across “many great products with great acronyms”. However, this means that information is not always comparable, while investors ask for comparability and tools to work with. And, he noted, some time in the future investors might come to the IFRS Foundation and ask for that there. Therefore, he concluded, the IASB is currently not moving into the foreground of sustainability reporting, but, when asked, “we must be prepared”.

Review the conference agenda papers on the IASB's website.

Recent sustainability developments

Sep 30, 2019

A summary of recent developments at the Sustainability Accounting Standards Board (SASB) and the Climate Disclosure Standards Board (CDSB).

The Sustainability Accounting Standards Board (SASB) and the Climate Disclosure Standards Board (CDSB) have jointly released the TCFD Good Practice Handbook, a complement to the TCFD Implementation Guide, released in May 2019. The handbook provides real-world examples of TCFD reporting to help companies better understand how they can more effectively communicate with investors about the financially material climate-related risks and opportunities they face.

The CDSB has also launched a climate-related financial disclosure e-learning platform designed to help organizations fill the knowledge gap and enhance their disclosures of climate-related information. Hosted on the TCFD Knowledge Hub, the e-learning courses will be CPD accredited and suitable for companies, investors and finance professionals.

Democratic senators call on FASB for more international disclosures

Sep 30, 2019

On September 30, 2019, the US Senate released a letter asking the Financial Accounting Standards Board (FASB) Chairman Russell Golden to require companies to break out more information on a country-by-country basis.

The senators want companies to provide country-specific information on their income, assets, number of employees, and taxes paid.

FASB is in the midst of reviewing tax disclosure requirements, and the letter was in response to a revised exposure draft on the proposed Accounting Standards Update to Income Taxes (Topic 740).

Review the letter on US Senate's website and a summary on Accounting Today's website.

IASB finalizes phase 1 of its IBOR reform project

Sep 26, 2019

On September 26, 2019, the International Accounting Standards Board (IASB) published "Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7)" as a first reaction to the potential effects the IBOR reform could have on financial reporting. The amendments are effective for annual periods beginning on or after January 1, 2020, with earlier application permitted.



Interbank offered rates (IBORs) are interest reference rates, such as LIBOR, EURIBOR and TIBOR, that represent the cost of obtaining unsecured funding, in a particular combination of currency and maturity and in a particular interbank term lending market. Recent market developments have brought into question the long-term viability of those benchmarks.

The amendments published today deal with issues affecting financial reporting in the period before the replacement of an existing interest rate benchmark with an alternative interest rate and address the implications for specific hedge accounting requirements in IFRS 9, Financial Instruments and IAS 39, Financial Instruments: Recognition and Measurement, which require forward-looking analysis. (IAS 39 is amended as well as IFRS 9 because entities have an accounting policy choice when first applying IFRS 9, which allows them to continue to apply the hedge accounting requirements of IAS 39. ) There are also amendments to IFRS 7, Financial Instruments: Disclosures regarding additional disclosures around uncertainty arising from the interest rate benchmark reform.



The changes in Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7)

  • modify specific hedge accounting requirements so that entities would apply those hedge accounting requirements assuming that the interest rate benchmark on which the hedged cash flows and cash flows from the hedging instrument are based will not be altered as a result of interest rate benchmark reform;
  • are mandatory for all hedging relationships that are directly affected by the interest rate benchmark reform;
  • are not intended to provide relief from any other consequences arising from interest rate benchmark reform (if a hedging relationship no longer meets the requirements for hedge accounting for reasons other than those specified by the amendments, discontinuation of hedge accounting is required); and
  • require specific disclosures about the extent to which the entities' hedging relationships are affected by the amendments.


Effective date

The amendments are be effective for annual periods beginning on or after January 1, 2020 and must be applied retrospectively. Early application is permitted.


Additional information

In September 2019, the IASB began discussions on IBOR reform and the effects on financial reporting - Phase 2. The second phase of the project deals with issues that might affect financial reporting when an existing interest rate benchmark is actually replaced.

FRC Lab report on cash disclosures

Sep 25, 2019

In September 2019, the Financial Reporting Lab of the UK Financial Reporting Council (FRC) released a report that considers disclosures on the sources and uses of cash.

The report considers how companies can answer investors’ questions about how a company generates cash and how it intends to use that cash. It provides practical guidance on how companies can give more information and context around its cash disclosures, beyond those in the cash flow statement including business model disclosures, capital allocation frameworks, reverse factoring arrangements and many others. It also includes several practical examples.

Review the report from the FRC's website.

AcSB response – Amendments to IFRS 17

Sep 25, 2019

On September 25, 2019, the Accounting Standards Board (AcSB) responded to the International Accounting Standards Board's (IASB) Exposure Draft, issued in June 2019.

The AcSB encouraged the IASB to move quickly to finalize IFRS 17, as the standard is expected to benefit the global capital markets. A common global adoption date of IFRS 17 is critical to the success of transitioning to the new insurance contract standard.

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

CRD launches report on alignment between its members' sustainability standards and frameworks and the TCFD recommendations

Sep 24, 2019

At the World Congress of Accountants in Australia in November 2018, the Corporate Reporting Dialogue (CRD), which brings together organisations that have significant international influence on the corporate reporting landscape, announced a two-year project focused on aligning the standards and frameworks of its members. A report 'Driving Alignment in Climate-related Reporting' was now launched amongst businesses and investors at the World Economic Forum’s Sustainable Development Impact Summit, during Climate Week NYC.

The publication maps the better alignment project participants’ standards and frameworks against the seven principles for effective disclosure, the 11 recommended disclosures and 50 illustrative example metrics detailed in the recommendations published by the Task Force on Climate-related Financial Disclosure (TCFD) in June 2017. It also documents the commonalities and differences between the participants within the parameters of the TCFD recommendations’ example metrics.

Participants of the CRD project on better alignment are the Carbon Disclosure Project (CDP), the Climate Disclosure Standards Board (CDSB), the Global Reporting Initiative (GRI), the International Integrated Reporting Council (IIRC), and the Sustainability Accounting Standards Board (SASB). Additional members of the CRD are the Financial Accounting Standards Board (FASB, observer), the International Accounting Standards Board (IASB), and the International Organization for Standardization (ISO).

The mapping in the report shows strong alignment between the participants’ frameworks and standards and the TCFD recommendations, specifically:

  • The TCFD’s seven ‘Principles for Effective Disclosures’ are harmonious and complementary with those of the participants’ frameworks and standards, with the mapping showing no sources of conflict.
  • The participants are well-aligned with the TCFD’s 11 recommended disclosures, each of which is comprehensively covered by the frameworks and standards.
  • Overall, 80% of the TCFD’s 50 illustrative metrics are fully or reasonably covered by CDP, GRI and SASB indicators.
  • There are high levels of alignment between CDP, GRI and SASB for the TCFD’s illustrative example metrics, with 70% of the TCFD’s 50 metrics showing no substantive difference between the participants’ indicators. For the remaining 15 indicators, substantive differences are limited.

Review the full report and more information on the CRD'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.