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.

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.

The report recommends a set of Environmental, Social and Governance (ESG) disclosure requirements, including the standard format to be used for the reporting.

Review the final report and supporting documents on the EC's website.

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.

Questions this year covered a broad range of topics, including: global questions on board gender diversity, director overboarding, and director accountability relating to climate change risk, combined chairman and CEO roles and the sun-setting of multi-class capital structures in the U.S., discharge of directors and board responsiveness to low support for remuneration proposals in Europe, U.S. and Canada.

Review the report on the ISS' website.

At first glance, the new provision appears consistent with the Supreme Court’s reasoning in cases on director liability, but, given a heightened climate for director accountability and recent focus on stakeholder interests in Canada and abroad, it is imperative to review the potential implications of these changes for corporate leaders.

The summary covers:

• From shareholder’s to stakeholder’s primacy?
• CBCA now expressly recognizes stakeholder interests
• Differences between the CBCA and US corporate statutes
• Recommendations

Review Bill C-97 on the Parliament of Canada's website and the summary on Norton Rose Fulbright's website.

Across all aspects of American life, it is most often men who set policy, allocate resources, lead companies, shape markets, and determine whose stories get told. Meanwhile, what gains have been made typically haven’t extended to all women. The women historically the most marginalized in this country — including women of color, poor women, and lesbian and trans women — are still the most likely to be trapped in minimum-wage jobs, the least likely to hold managerial roles, and the most likely to face sexual harassment and gender-based violence.

Review the full article on the Harvard Business Review's website.

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.

Background

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.

Changes

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

• IASB press release
• IASB project summary

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.

Review the full article on the Harvard Business Review's website.