News

IFRS - IASB Image

Article on IFRS 17

Jul 05, 2018

On July 5, 2018, the International Accounting Standards Board (the Board) published the article "Reducing the gap between insurance and other industries" by IASB® member Gary Kabureck.

The article outlines the similarities between IFRS 17 and other IFRS® Standards as regards the measurement of obligations at current value and the recognition of revenue as a company provides services to its customers. It concludes that the changes introduced by IFRS 17 will enable a wider range of users to understand insurers’ financial statements and compare them with the financial statements of companies within and outside the insurance industry.

Review the article on the Board's website.

Securities - OSC Image

OSC Publishes 2018-2019 Statement of Priorities

Jul 05, 2018

On July 5, 2018, the Ontario Securities Commission (OSC) published its 2018-2019 Statement of Priorities, which sets out the 15 priority areas where the OSC intends to focus resources and actions over the coming fiscal year, as well as the expected outcomes.

The OSC received 20 comment letters on its draft 2018-2019 Statement of Priorities. Feedback was broadly supportive of the proposed priorities, including continued improvements to investor protection and efforts to increase the deterrent impact of enforcement actions. This final publication of the 2018-2019 Statement of Priorities now also includes a priority related to the continued review of the effectiveness of the disclosure requirements regarding women on boards and in executive officer positions.

Review the press release and the Statement of Priorities on the OSC's webiste.

IFRS - IASB Image

Group of national standard-setters urges IASB to consider hybrid pension plans

Jul 04, 2018

In July 2018, the International Accounting Standards Board (IASB) released an agenda paper that will be presented at the upcoming meeting of the IASB's Accounting Standards Advisory Forum (ASAF), where the Canadian Accounting Standards Board (AcSB) will present the results of research performed to date by Canada, Germany, Japan, the UK and the US on hybrid pension plans, which are neither defined contribution plans nor defined benefit plans. The paper argues that further guidance on accounting for hybrid pension plans is needed to better reflect their economic characteristics and reduce diversity in practice.

A working group of staff from the standard-setters in the five jurisdictions embarked on research to produce evidence demonstrating whether there is a need for accounting guidance addressing hybrid pension plans. The working group's aim was to understand the experiences of jurisdictions around the world with hybrid pension plans and whether common issues arise as well as to determine whether existing standards adequately deal with such plans and identify possible improvements, if needed. The research is on-going and is currently being expanded to other jurisdictions.

The research so far provides evidence from multiple jurisdictions to support a need for guidance on accounting for hybrid pension plans and is sufficiently complete to be brought to the attention of others with a view to encouraging standard-setting action on this topic. Therefore, the working group proposes that the IASB consider the research performed to date and either add it as another dimension to the feasibility study Pension Benefits that Depend on Asset Returns in its research pipeline or take on a project to address hybrid pension plans.

Meanwhile, the working group will expand its research to other jurisdictions by summarising and analysing data collected from IFASS member jurisdictions, will expand outreach to financial statement users and academics within several jurisdictions, and will continue to monitor related activities.

Review the working group's paper on the IASB's website.

Securities - OSC Image

OSC Announces Continuous Disclosure Advisory Committee Members

Jul 04, 2018

On July 4, 2018, the Ontario Securities Commission (OSC) announced the new membership of its Continuous Disclosure Advisory Committee (CDAC). Among the new members is Julia Suk, Partner at Deloitte.

The CDAC advises OSC staff on the planning, implementation and communication of its continuous disclosure review program, as well as related policy initiatives. The CDAC also serves as a forum to advise OSC staff on emerging issues. OSC staff recognize the critical importance of consulting with market participants and other stakeholders in carrying out its mandate.

The CDAC will meet approximately five times per year with members serving a two-year term.

Review the press release on the OSC's website.

IFRS - IASB Image

IASB issues "Investor Update" newsletter

Jul 03, 2018

On July 3, 2018, the International Accounting Standards Board (the Board) issued the sixteenth edition of its newsletter "Investor Update", which provides investors with quick access to information about current accounting and financial reporting topics.

This issue features:

  • Spotlight — IFRS 16 Leases
  • Spotlight — ESMA and IFRS Standards
  • In Profile —Selim Gogus, Credit Suisse HOLT
  • Project updates
  • Information on investor materials and current events

Review the Investor Update newsletter on the Board’s website.

IFRS - AcSB Image

AcSB and OIC hold joint meeting

Jul 03, 2018

On July 3, 2018, the Accounting Standards Board (AcSB) posted a summary of a joint meeting held on June 20 between the AcSB and the Italian standard-setter Organismo Italiano di Contabilità (OIC) in Toronto. The meeting was the first bilateral meeting between the two standard-setters.

In addition to giving updates on their respective standard-setting activities at the meeting, the two boards exchanged views on implementation activities regarding the standards on financial instruments, revenue, and leases, technical issues on IFRS 17 and the IASB’s current project on rate-regulated activities. In addition, the AcSB and the OIC discussed two projects of individual interest, specifically, relevance of performance measures and business combinations under common control.

Review the press release on the AcSB's website.

1_Germany Image

Strong messages against EU carve-in carve-out proposal at ASCG anniversary event

Jul 02, 2018

On July 2, 2018, the German standard-setter ASCG celebrated 20 years of its existence by hosting a festive event in Berlin that saw official addresses and a keynote speech by representatives from politics, industry and national and international standard-setting as well as two panel discussions on financial reporting in the times of changing values and technological disruption.

The welcome address by Prof Dieter Truxius, Vice-Chair of the Administrative Board of the ASCG and one of Germany's leading experts in accounting and controlling issues related to German family-owned businesses, already revealed a clear message that would resurface in all speeches and discussions. He noted that the German industry is extremely critical of proposals that might lead to modifying IFRS® Standards during the EU endorsement process or even after they have been endorsed.

He concluded: "Such trends lead to disparities in international accounting and prevent cross-border comparability of financial statements. Ladies and gentlemen, we should take a firm stand against this trend."

The two ensuing panel discussions showed an interesting combination of panelists. A Member of Parliament, a CFO, an NGO representative, and an auditor discussed "Changing behaviour by requiring ESG information – Where is the boundary of the financial report?". While it was noted by some that a lot of reporting on ESG issues is boilerplate, it was also stated that there was an increased visibility and awareness of information, not only from the outside but also within companies. Whether reporting requirements could and should be used to change behaviour was contested with views ranging from the role financial markets can play to achieve sustainability to the warning against overtaxing reporting with an inflation of additional requirements. Measurability (and therefore auditability) and materiality were also controversely discussed with the difference of materiality to an entity and materiality to society especially noted.

In the concluding panel, the IASB Chairman, a CAO of a digital company, an ESMA representative, and a professor of accounting discussed "Digital reporting vs. Reporting in a digital world". The opening round of questions alone showed the many facets of the topic with some insights of what is already possible proving to be almost scary. Questions around XBRL dominated the discussion on what is currently being done, which saw comments on comparability in connection with block tagging, detailed tagging, and use of XBRL extensions, although it was mentioned that XBRL might not be more than an interim solution. It was also noted that as a result of increasing digitalisation information overload ceases to be so much of a problem and materiality questions might need to be asked differently. However, it was warned that while more and more information can be processed electronically and, therefore, quicker understanding patterns and drivers has not become easier. It was asked whether and when a point comes where we trust machine judgement more than management judgement and whether at some point of time, reporting and consumption of financial information would become a game of "Watson against Watson". One important aspect in the whole discussion was also the question of what is being reported as companies with digital business models have huge amounts of intangibles they cannot show in their financial statements. Accounting for intangibles was clearly identified as an area where current financial reporting needs to evolve.

An informal exchange of opinions between the many national and international guests, which included representatives of the standard-setters from the US, Canada, Australia, Japan, and Hong Kong, concluded the event.

Review a summary of the event, in German, on the ASCG's website.

CDSB (Climate Disclosure Standards Board) Image

CDSB publishes new report on climate resilience

Jul 01, 2018

In July 2018, the Cli­mate Dis­clo­sure Stan­dards Board (CDSB) and the Car­bon Dis­clo­sure Pro­ject (CDP) have re­leased a re­port “Reporting climate resilience: The challenges ahead.”

Per the report, the top three challenges for companies in adopting the TCFD recommendations are identified as (1) ensuring leadership support for enhanced disclosure, (2) revising risk assessment processes, and (3) applying scenario analysis to climate change.

For further details, refer to the report on the CDSB’s website.

 

GRI (Global Reporting Initiative) Image

GRI announces that the transition to the Sustainability Reporting Standards (GRI Standards) is complete

Jul 01, 2018

On June 14, 2018, the Global Re­port­ing Ini­tia­tive (GRI) an­nounced that, as of July 1, 2018, the transition from GRI’s G4 guidelines to the Sustainability Reporting Standards (GRI Standards) will be complete. The GRI Standards feature a modular, interrelated structure, and represent the global best practice for reporting on a range of economic, environmental and social impacts. This makes them easier to update, so that they keep pace with developments in the different fields.

Refer to the June 14, 2018 GRI press release for further details.

In addition, on June 28, 2018, the GRI has released two updated standards:

GRI 403: Occupational Health and Safety 2018 – Putting worker health first

GRI 303: Water and Effluents 2018 – From water management to water stewardship

Refer to the June 28, 2018 GRI press release for further details of these updated standards.

 

IFRS - IASB Image

Educational webcast on IFRS 9

Jun 29, 2018

On June 29, 2018, the International Accounting Standards Board (the Board) released a webcast that discusses how to apply IFRS 9 "Financial Instruments" to financial assets with prepayment features.

The eleven minute webcasts focusses on the "SPPI test", including the amendments made to the IFRS 9 requirements in October 2017.

View the webcast on the Board's website (available as full webcast or in a slides only version).

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