This staff Spotlight highlights important considerations and examples for auditors related to commercial real estate (CRE), as they plan and conduct audits and reviews of interim financial information in many industries with CRE exposure. For example, the report provides a specific set of questions that auditors may want to consider in the context of identifying and assessing risks, including the risk of fraud.

The Spotlight also provides reminders in the following key areas:

• Asset impairment and allowance for credit losses
• Going concern
• Interim review considerations

Access the Spotlight report on the PCAOB’s website.

There are some critical insights from the Stanford Graduate School of Business survey, the Hoover Institution Working Group on Corporate Governance, and the Arthur and Toni Rembe Rock Center for Corporate Governance at Stanford University. In partnership with the MSCI Sustainability Institute, the survey asked leading institutional asset owners and managers about their methods of integrating ESG factors into investment decisions.

 The survey revealed that governance-related factors take precedence in the investment decisions of more than two-thirds of investors in Europe and North America, especially in the short term. Climate risk, however, gains prominence in the medium term, with 93% of investors acknowledging that climate-related issues will most likely impact investment performance in the coming two to five years.

Access the survey on The Hoover Institution’s website.

The ISSB Taxonomy will enable investors to search, extract and compare sustainability-related financial disclosures provided under the ISSB standards. The ISSB Taxonomy reflects IFRS S1, IFRS S2 and guidance accompanying the standards.

The ISSB Taxonomy is consistent with the IFRS Accounting Taxonomy so that entities can provide a holistic digital financial reporting package to investors. However, the ISSB Taxonomy can also be used with other digital taxonomies.

Access the press release on the IFRS Foundation website.

The podcast highlights some of the projects that were discussed during the meeting, including:

• Start of a thorough review concerning intangible assets
• Developments within the climate-related and other uncertainties in the financial statements project
• Finalization of the agenda decision pertaining to net-zero commitments
• Insights into the ongoing post-implementation reviews of IFRS 15 and IFRS

The podcast can be accessed here on the IFRS Foundation website

The PCAOB strongly encourages firms to assess the underlying root causes of a deficiency so that the deficiency can be effectively addressed and ultimately remediated and eliminated. Root Cause Analysis (RCA) is used by many audit firms to evaluate the adequacy of and compliance with their quality control system.

The PCAOB staff believes that RCA is an effective practice for firms to drive audit quality. The Spotlight covers:

• General considerations related to RCA
• Other observations about RCA from PCAOB inspections
• Key questions for audit firms to consider

In addition to audit firms, audit committees and others charged with governance may find the firm’s root cause analysis informative as they discuss past inspection deficiencies, the cause of those deficiencies, what corrective actions were taken to address these deficiencies, and what preventive measures a firm has taken to improve their audit quality going forward.

Access the Spotlight report on the PCAOB’s website.

The ISSB Taxonomy will enable investors to search, extract and compare sustainability-related financial disclosures provided under the ISSB standards. The ISSB Taxonomy reflects IFRS S1, IFRS S2 and guidance accompanying the standards.

The ISSB Taxonomy is consistent with the IFRS Accounting Taxonomy so that entities can provide a holistic digital financial reporting package to investors. However, the ISSB Taxonomy can also be used with other digital taxonomies.

Access the press release on the IFRS Foundation website.

Part 2 of Bill C-69 enacts the Global Minimum Tax Act (GMTA), a regime based on the rules of the Organisation for Economic Co-operation and Development (OECD). The global minimum tax regime will subject large multinational corporations to a minimum effective tax rate of 15% on their profits wherever they do business. It sets out rules for the purposes of establishing liability for the tax and also sets out applicable reporting and filing requirements.

Review Bill C-69 on the Parliament of Canada’s Web site.

Below is an analysis of all changes made to the work plan since our last analysis on March 23, 2024

Standard-setting projects

• Equity Method — An exposure draft is expected in Q3 2024 (previously H2 2024)
• Management Commentary — A decision on the project direction is now expected in June 2024 (previously Q2 2024)
• Primary Financial Statements — This project has been removed from the work plan since the issuance of IFRS 18 Presentation and Disclosures in Financial Statements on April 9

Maintenance projects

• Annual improvements to IFRS Accounting Standards — The following now have the final amendment to be issued in July 2024 (previously Q3 2024):
• Cost Method (Amendments to IAS 7) 
• Derecognition of Lease Liabilities (Amendments to IFRS 9) 
• Determination of a ‘De Facto Agent’ (Amendments to IFRS 10) 
• Disclosure of Deferred Difference between Fair Value and Transaction Price (Amendments to Guidance on implementing IFRS 7) 
• Gain or Loss on Derecognition (Amendments to IFRS 7) 
• Hedge Accounting by a First-time Adopter (Amendments to IFRS 1) 
• Introduction and Credit Risk Disclosures (Amendments to Guidance on implementing IFRS 7) 
• Transaction Price (Amendments to IFRS 9)
• Climate-related and Other Uncertainties in the Financial Statements — The next project step will now be an exposure draft expected to be published in Q3 2024.

Governance projects

• ISSB Consultation on Agenda Priorities — A feedback statement is now expected in June 2024 (previously Q2 2024)

Research projects

• Business Combinations under Common Control — This project has been removed from the work plan since the IASB completed it by publishing a project summary on April 17, 2024
• Intangible Assets
• Post-implementation Review of IFRS 15 — Revenue from Contracts with Customers — A feedback statement is now expected in Q3 2024 (previously H2 2024).

Other projects

• IFRS Accounting Taxonomy Update: The following projects were removed from work plan since the release of the update on March 27:
• Amendments to IAS 12, IAS 21, IAS 7 and IFRS 7
• Common Practice (Financial Instruments) and General Improvements
• IFRS Accounting Taxonomy Update — Primary Financial Statements — A proposed IFRS Taxonomy Update is expected in May 2024 (previously Q2 2024)
• IFRS Accounting Taxonomy Update — Subsidiaries without Public Accountability: Disclosure and Amendments to IFRS 7 and IFRS 9 — A proposed IFRS Taxonomy Update is expected in Q3 2024 (previously H2 2024)
• IFRS Sustainability Disclosure Taxonomy — This project has been removed from the work plan since the ISSB published the disclosure taxonomy in April 2024.

The above is a faithful comparison of the IASB and ISSB work plan on March 26, 2024 and April 29, 2024

For access to the current work plan at any time, please click here.

The podcast discusses the following:

• IFRS Advisory Council meeting
• International Forum of Accounting Standard Setters
• Commence research projects about risks and opportunities related to nature and human capital
• Launch of the IFRS Sustainability Disclosure Taxonomy
• Forthcoming joint educational material with EFRAG on interoperability.

Access the press release on the IFRS Foundation website.

Below is an analysis of all changes made to the work plan since our last analysis on March 23, 2024

Standard-setting projects

• Equity Method — An exposure draft is expected in Q3 2024 (previously H2 2024)
• Management Commentary — A decision on the project direction is now expected in June 2024 (previously Q2 2024)
• Primary Financial Statements — This project has been removed from the work plan since the issuance of IFRS 18 Presentation and Disclosures in Financial Statements on April 9

Maintenance projects

• Annual improvements to IFRS Accounting Standards — The following now have the final amendment to be issued in July 2024 (previously Q3 2024):
• Cost Method (Amendments to IAS 7) 
• Derecognition of Lease Liabilities (Amendments to IFRS 9) 
• Determination of a ‘De Facto Agent’ (Amendments to IFRS 10) 
• Disclosure of Deferred Difference between Fair Value and Transaction Price (Amendments to Guidance on implementing IFRS 7) 
• Gain or Loss on Derecognition (Amendments to IFRS 7) 
• Hedge Accounting by a First-time Adopter (Amendments to IFRS 1) 
• Introduction and Credit Risk Disclosures (Amendments to Guidance on implementing IFRS 7) 
• Transaction Price (Amendments to IFRS 9)
• Climate-related and Other Uncertainties in the Financial Statements — The next project step will now be an exposure draft expected to be published in Q3 2024

Governance projects

• ISSB Consultation on Agenda Priorities — A feedback statement is now expected in June 2024 (previously Q2 2024)

Research projects

• Business Combinations under Common Control — This project has been removed from the work plan since the IASB completed it by publishing a project summary on April 17, 2024
• Intangible Assets — This project has been added to the work plan and a review of the research is expected in H2 2024
• Post-implementation Review of IFRS 15 — Revenue from Contracts with Customers — A feedback statement is now expected in Q3 2024 (previously H2 2024).

Other projects

• IFRS Accounting Taxonomy Update: The following projects were removed from work plan since the release of the update on March 27:
• Amendments to IAS 12, IAS 21, IAS 7 and IFRS 7
• Common Practice (Financial Instruments) and General Improvements
• IFRS Accounting Taxonomy Update — Primary Financial Statements — A proposed IFRS Taxonomy Update is expected in May 2024 (previously Q2 2024)
• IFRS Accounting Taxonomy Update — Subsidiaries without Public Accountability: Disclosure and Amendments to IFRS 7 and IFRS 9 — A proposed IFRS Taxonomy Update is expected in Q3 2024 (previously H2 2024)
• IFRS Sustainability Disclosure Taxonomy — This project has been removed from the work plan since the ISSB published the disclosure taxonomy in April 2024.

The above is a faithful comparison of the IASB and ISSB work plan on March 26, 2024 and April 29, 2024

For access to the current work plan at any time, please click here.