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Part I - IFRS

IASB publishes proposed amendments to IFRS 17

Jun 26, 2019

On June 26, 2019, the In­ter­na­tional Ac­count­ing Stan­dards Board (IASB) published an Exposure Draft, Amendments to IFRS 17, to address concerns and implementation challenges that were identified after IFRS 17, Insurance Contracts, was published in 2017. Comments are requested by September 25, 2019.


Since IFRS 17, Insurance Contracts, was issued in May 2017, the Board has been monitoring the implementation and has learned about concerns and implementation challenges. The Board had previously indicated that it would consider whether additional action is needed to address matters arising during implementation. At the October 2018 meeting of the Board a list of 25 potential amendments to the standard was identified and the criteria against which any possible amendment would be considered were agreed. Subsequent discussions led to the proposed amendments that are included in the Exposure Draft.

Suggested changes

The main changes proposed in ED/2019/4, Amendments to IFRS 17, are:

  • Deferral of the date of initial application of IFRS 17 by one year to annual periods beginning on or after January 1, 2022 and change the fixed expiry date for the temporary exemption in IFRS 4, Insurance Contracts, from applying IFRS 9, Financial Instruments, so that entities would be required to apply IFRS 9 for annual periods beginning on or after January 1, 2022. 
  • Additional optional scope exclusion for loan contracts that transfer significant insurance risk and related transition requirements to enable entities issuing such contracts to account for those contracts applying either IFRS 17 or IFRS 9. 
    • Additional scope exclusion for credit card contracts that provide insurance coverage. 
  • Amendments regarding allocation, recognition, assessment of the recoverability, and disclosure regarding insurance acquisition cash flows relating to expected contract renewals. 
  • Amendments regarding the contractual service margin (CSM) allocation relating to investment components and related disclosure requirements so that in the general model the CSM is allocated on the basis of coverage units that are determined by considering both insurance coverage and any investment return service. 
    • Extension of the risk mitigation option to include reinsurance contracts held. 
    • Amendments to require an entity that at initial recognition recognizes losses on onerous insurance contracts issued to also recognize a gain on reinsurance contracts held. 
  • Simplified presentation of insurance contracts in the statement of financial position so that entities would present insurance contract assets and liabilities in the statement of financial position determined using portfolios of insurance contracts rather than groups of insurance contracts. 
  • Additional transition relief for business combinations. 
  • Additional transition relief for the date of application of the risk mitigation option and the use of the fair value transition approach.

The exposure draft also contains several smaller proposed amendments.

Comments on the proposed changes are requested by September 25, 2019.

Effective date

The proposed effective date for the amendments would be the same as the proposed new effective date for IFRS 17 (i.e. January 1, 2022) with early application permitted. The amendments would be applied retrospectively.

Additional information

Please click for:

FASB begins second study on segment reporting

Jun 25, 2019

On June 25, 2019, the Fi­nan­cial Ac­count­ing Stan­dards Board (FASB) announced that it will be conducting its second study on potential improvements to the segment disclosure and reconciliation requirements.

Specifically, the FASB is requesting feedback from public companies on “the issues preparers may face in applying different potential improvements for the existing segment disclosure requirements.”

For more information, see the press release on the FASB’s Web site.

IASB posts webcast on borrowing costs and revenue recognition

Jun 24, 2019

On June 24, 2019, the In­ter­na­tional Ac­count­ing Stan­dards Board (IASB) posted a webcast, by IASB technical staff Jawaid Dossani and Nicolette Lange, that discusses conclusions reached by the IFRS Interpretation Committee related to the application of IAS 23, ‘Borrowing Costs’ and its interaction with IFRS 15, ‘Revenue from Contracts with Customers’.

At the March 5-6, 2019 IFRS Interpretation Committee meeting, the Committee determined that borrowing costs would not be capitalized when the borrowings relate to the construction of a residential multi-unit real estate development for which revenue is recognized over time.

For more information, see the press release on the IASB’s website.

Updated IASB work plan — Analysis

Jun 21, 2019

On June 21, 2019, following the In­ter­na­tional Ac­count­ing Stan­dards Board’s (IASB’s) June 2019 meeting, we have analyzed the IASB work plan to see what changes have resulted from the meeting and other developments since the work plan was last revised in May 2019. Most changes relate to exposure drafts having been published or comment letter periods having ended.

Below is an analysis of all changes that were made to the work plan since our last analysis on May 18, 2019.

Standard-setting projects

  • Rate-regulated activities — the expected timing of a discussion paper or exposure draft has been moved to H1 2020 (was: H2 2019).

Maintenance projects

  • The IASB published an Exposure Draft “Annual Improvements to IFRS Standards 2018–2020” on May 21, 2019. The following projects are part of the annual improvements 2018-2020 project and are therefore now reflected as open to comment in the work plan: (i) fees in the ‘10 per cent’ Test for Derecognition (Amendments to IFRS 9); (ii) lease incentives (Amendment to Illustrative Example 13 accompanying IFRS 16);  (iii) subsidiary as a First-time Adopter (Amendments to IFRS 1); and (iv) taxation in Fair Value Measurements (Amendments to IAS 41);
  • IBOR reform and the effects on financial reporting — the work plan reflects that the comment period on the exposure draft has ended; a first discussion of the feedback received is scheduled for Q3 2019;
  • Updating a reference to the Conceptual Framework (Amendments to IFRS 3) — The IASB published an exposure draft Reference to the Conceptual Framework (Proposed amendments to IFRS 3) on May 30, 2019 - the work plan reflects that the project is now open for comment.

Research projects

  • No changes.

The above is a faithful comparison of the IASB work plan at May 18, 2019 and at June 24, 2019. For access to the current IASB work plan, please click here.

AcSB In Brief: A plain and simple overview of the AcSB’s ongoing work in supporting the implementation of the new insurance standard

Jun 21, 2019

On June 21, 2019, the Accounting Standards Board (AcSB) issued an In Brief document that provides a plain and simple overview of the AcSB’s ongoing work in supporting the implementation of the new insurance standard.

For fur­ther de­tails, re­fer to the In Brief doc­u­ment on the AcSB’s web­site.

IASB Chair discusses strengthening the relevance of financial reporting

Jun 20, 2019

On June 20, 2019, the In­ter­na­tional Ac­count­ing Stan­dards Board (IASB) made avail­able a speech by IASB Chair Hans Hoogervorst at the IFRS Foundation Conference in London, in which he discussed the Board’s plans to maintain and strengthen the relevance of financial reporting in primary financial statements and management commentary.

Mr Hoogervorst began with an overview of the primary financial statements (PFS) project and provided comments related to subtotals (definition of operating profits and profit before financing and tax), labeling non-GAAP measurement as ‘management performance measures’, improvements to disaggregation, the disclosure of ‘unusual’ items of income or expenses, and the impact the PFS proposals will have to the quality and usefulness of the income statement.

Next, Mr Hoogervorst commented on the importance of management commentary (a topic he also covered in similar speech at the Climate-Related Financial Reporting Conference in April 2019) to provide broader financial information, such as the impact of intangibles. He mentioned the need to update the Management Commentary Practice Statement to accommodate new advances made in the environmental, sustainability and governance reporting space.

For more information, see the transcript of his speech on the IASB’s website.

Forthcoming IASB publication: Exposure Draft—Amendments to IFRS 17, Insurance Contracts

Jun 20, 2019

On June 20, 2019, the In­ter­na­tional Ac­count­ing Stan­dards Board (IASB) announced that it expects to publish the Exposure Draft “Amendments to IFRS 17, Insurance Contracts” on June 26, 2019.

Re­view the announcement on the IASB’s web­site.

Deloitte Global comments on the IASB’s proposal on interest rate benchmark reform

Jun 17, 2019

On June 17, 2019, De­loitte Global issued its comment letter in response to the IASB’s exposure draft, ‘Interest Rate Benchmark Reform — Proposed amendments to IFRS 9 and IAS 39’

Deloitte Global supports the IASB’s response in proposing amendments to both IFRS 9 and IAS 39 that deal with the immediate need of addressing the effect of the uncertainty arising from changes in benchmark interest rates on the “highly probable” requirement for cash flow hedges and the designated risk for cash flow and fair value hedges and suggest the IASB work on finalizing these amendments and begin the work on its second phase of amendments concurrently.

In addition, Deloitte Global believes there is a lack of clarity in (1) the application to retrospective hedge effectiveness, (2) the measurement of hedge ineffectiveness, and (3) whether the amounts deferred in the cash flow hedge reserve should be reclassified to profit or loss when the entity ceases applying the amendment.

Please download the full comment letter here.

AcSB response – Interest rate benchmark reform exposure draft

Jun 17, 2019

On June 17, 2019, the Accounting Standards Board (AcSB) responded to the IASB’s Exposure Draft, Interest Rate Benchmark Reform (Proposed amendments to IFRS 9 and IAS 39).

The AcSB supports the IASB’s decision to provide relief to the forward-looking aspect of the hedged accounting requirements in the first phase of this project.

However, the AcSB thinks some of the project issues in Phase 2, such as the retrospective assessment and the recycling of the accumulated other comprehensive income balance, are closely related to the issues in the first phase and should be addressed as soon as possible.

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

AcSB Exposure Draft – Reference to the Conceptual Framework (Proposed amendments to IFRS 3, Business Combinations)

Jun 14, 2019

On June 14, 2019, the Ac­count­ing Stan­dards Board (AcSB) is­sued its Ex­po­sure Draft that cor­re­sponds to the IASB’s Ex­po­sure Draft on this topic. Stake­hold­ers are en­cour­aged to sub­mit their com­ments by September 27, 2019.

The IASB proposes to amend IFRS 3 to replace the reference to The Framework for

the Preparation and Presentation of Financial Statements with the revised Conceptual Framework for Financial Reporting in a way that avoid conflicts with other IFRS® Standards

For fur­ther de­tails, re­fer to the Ex­po­sure Draft on the AcSB’s web­site.

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