Accounting Policies and Accounting Estimates (Potential Amendments to IAS 8) [Completed]
Effective date: |
The amendments are effective for annual periods beginning on or after January 1, 2023 and changes in accounting policies and changes in accounting estimates that occur on or after the start of that period. Earlier application is permitted. |
Last updated: |
June 2021 |
Overview
The purpose of this project was to clarify the distinction between a change in an accounting policy and a change in an accounting estimate, in relation to the application of IAS 8. The project was added to the International Accounting Standards Board's (IASB) work plan in May 2015.
Companies find it difficult to distinguish between a change in accounting policy and a change in accounting estimate, especially when it relates to a change in a measurement method. This distinction is important because changes in accounting estimates often affect an entity’s profit or loss, but changes in accounting policies generally do not.
The IASB proposed clarifying the definitions of "accounting policies" and "accounting estimates" in IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors by making those two definitions more distinct and concise. The IASB also proposed clarifying, through additional guidance and examples, how accounting policies and accounting estimates relate to each other and how companies decide whether a change in valuation technique or a change in estimation technique is a change in an accounting estimate.
In this project, the Board developed amendments to IAS 8—these amendments introduced a definition of accounting estimates and included other amendments to IAS 8 to help entities distinguish changes in accounting policies from changes in accounting estimates.
In February 2021, the International Accounting Standards Board (Board) issued Definition of Accounting Estimates, which amended IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors.
The amendments introduced the definition of accounting estimates and included other amendments to IAS 8 to help entities distinguish changes in accounting estimates from changes in accounting policies.
On June 1, 2021, the AcSB issued the amendments to IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors, to Part I of the CPA Canada Handbook - Accounting.
Other developments
June 2021
On June 1, 2021, the AcSB issued the amendments to IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors, to Part I of the CPA Canada Handbook - Accounting.
February 2021
On February 12, 2021, the IASB published Definition of Accounting Estimates (Amendments to IAS 8) to help entities to distinguish between accounting policies and accounting estimates. The amendments are effective for annual periods beginning on or after January 1, 2023.
December 2020
On December 18, 2020, the IASB staff updated the Work Plan to indicate that the Board plans to issue the amendments to IAS 8 in February 2021.
November 2020
On November 20, 2020, IASB staff updated the Work Plan to indicate that the Board plans to issue the amendments to IAS 8 in Q1/2021
September 2020
On September 28, 2020, IASB staff updated the Work Plan to indicate that the Board plans to issue the amendments to IAS 8 in December 2020.
April 2020
On April 17, 2020, IASB staff updated the Work Plan to indicate that the Board plans to issue the Amendments to IAS 8 in Q4/2020.
November 2019
On November 25, 2019, the IASB IASB staff updated the Work Plan to indicate that the Board plans to issue the Amendments to IAS 8 (no date specified yet).
October 2019
On October 25, 2019, the IASB staff updated the work plan to indicate that the Board expects to finalize the amendments to IAS 8 at a future meeting (no date specified).
On October 1, 2019, the IASB staff updated the work plan to indicate that the Board expects to decide the project direction in December 2019.
July 2019
On July 29, 2019, the IASB staff updated the work plan to indicate that the Board expects to decide the project direction in Q4/2019.
March 2019
On March 14, 2019, the IASB staff updated the work plan to indicate that the Board will decide the project direction at a future meeting (no date specified).
January 2019
On January 25, 2019, the IASB staff updated the work plan to indicate that the Board expects to decide the project direction in April 2019.
December 2018
On December 14, 2018, the IASB staff updated the work plan to indicate that the Board expects to decide the project direction in Q2/2019.
September 2018
On September 20, 2018, the IASB staff updated the work plan to indicate that the Board plans to decide the project direction in December 2018.
July 2018
On July 18, 2018, the IASB staff updated the work plan to indicate that the Board plans to decide the project direction in October 2018.
March 2018
On March 23, 2018, the IASB staff updated the work plan to indicate that the Board plans to decide the project direction at a future meeting.
December 2017
On December 18, 2017, the IASB staff updated the work plan to indicate that the IASB expects to review the Exposure Draft Feedback in March 2018.
October 2017
On October 4, 2017, the AcSB issued its exposure draft that corresponds to the IASB’s Exposure Draft on this topic. Stakeholders are encouraged to submit their comments by January 15, 2018.
September 2017
On September 22, 2017, the IASB staff updated the work plan to indicate that the IASB expects to review the Exposure Draft Feedback in Q1 2018.
On September 12, 2017, the IASB published an exposure draft, Accounting Policies and Accounting Estimates (Proposed amendments to IAS 8), to help entities to distinguish between accounting policies and accounting estimates. Comments are requested by January 15, 2018.
June 2017
In June 2017, the IASB staff updated the work plan to indicate that the IASB expects to issue an Exposure Draft in September 2017.
April 2017
On April 28, 2017, the IASB staff issued an updated Work Plan which indicates that the IASB expects to publish an Exposure Draft for public comment in respect of this project in June 2017.
March 2017
On March 23, 2017, the IASB staff issued an updated Work Plan which indicates that the IASB expects to publish an Exposure Draft in respect of this project for comment by September 2017.
December 2016
On December 15, 2016, the IASB staff updated the Work Plan in respect of this project to indicate that the IASB expects to publish an Exposure Draft for comment by June 2017.
September 2016
On September 23, 2016, the IASB staff updated the Work Plan in respect of this project to indicate that the IASB expects to publish an Exposure Draft for comment by March 31, 2017.
July 2016
On July 20, 2016, the IASB staff updated the Work Plan in respect of this project to indicate that the IASB expects to publish an Exposure Draft for comment sometime before January 31, 2017.
July 2015
On July 31, 2015, the IASB updated its work plan. The ED will be delayed to Q1 2016 at the earliest.