IASB Meeting — 13–14 December 2017

Start date:

End date:

Location: London

IASB (International Accounting Standards Board)


The IASB met in public on Wednesday 13 and Thursday 14 December 2017. 

Wednesday 13 December

The meeting started with a continuation of the discussion on the Primary Financial Statements. There were three topics: objective of, and suitable locations for, the management performance measure; classification of interest and dividends in the statement of cash flows; and initial thoughts on other targeted improvements to the statement of cash flows. The staff had recommended that the Board:

  • explore how to present unusual or infrequently occurring items; and
  • require that the management performance measure be presented as a subtotal in the statement of financial performance, or in a separate reconciliation directly following the statement of financial performance.

The Board decided that the management performance measure would need to be reconciled to the IFRS sub-totals unless it “fits naturally within the statement of financial performance”. The Board discussed the other issues at length, including where such a number should be presented, but made no other decisions.

In relation to the cash flow statement, the Board approved recommendations to:

  • prescribe that interest paid on financing activities, regardless of whether it is capitalised, be classified as financing cash flows, dividends paid be classified as financing cash flows and interest and dividends received be classified as investing cash flows; and
  • not seek to align the operating sections of the income and cash flow statements; but
  • rejected a suggestion to explore further improvements to the statement of cash flows on the grounds that there are no widespread calls to address other issues.

The Board began considering feedback on its Discussion Paper Disclosure Initiative—Principles of Disclosure. The Board received 108 comment letters, and the staff provided a high-level overview of the views expressed on those letters. The overall impression is that respondents think the DP lacked focus and depth. There was also concern over a lack of cohesiveness between the different Disclosure Initiative projects. As an education session, the Board was not being asked to make any decisions. However, some Board members were sceptical about objective-based disclosure requirements and about using less prescriptive language.

Thursday 14 December

The Board continued its discussions on accounting for Goodwill. The Board voted 11-3 to explore the updated headroom approach further and, by the same margin, rejected a reintroduction of amortisation. 

The Board was given a project plan for the development of an accounting model for Dynamic Risk Management (DRM). The staff intend to focus on developing the areas that are core to the model (target profile, asset profile, DRM derivative instruments and performance assessment and recycling) which they will test with external stakeholders before addressing extensions of the concepts. No significant comments were made by Board members. The Staff expect that the discussion of the core model will take between six to eight sessions.

The Consultative Group for Rate Regulation met on 26 October 2017.  The staff summarised the Board the feedback from this meeting. The consultative group encouraged the Board to develop an exposure draft as the next consultative document. There was no discussion of this paper.

The Board considered four IFRS Implementation Issues. The Board:

  • was updated on the IFRS Interpretation Committee’s decision to add to its agenda a project to clarify which costs should be considered in assessing whether a contract is onerous;
  • supported a recommendation that the ED proposing to lower the threshold for relief from retrospective application of a change in accounting policy arising from agenda decisions also propose that the change to IAS 8 would be applied prospectively.
  • supported a recommendation from the IFRS Interpretation Committee to amend IFRS 1 to subsidiaries that apply adopt IFRS later than their parent with additional relief for measuring cumulative translation differences; and
  • discussed a summary of feedback on the proposed amendments to IAS 16 in relation to accounting for the proceeds from sales from testing—many respondents disagreed with the proposed amendments, considering them to be ineffective, costly to apply and require significant judgement.

During this session some concerns were raised that the agenda decisions of the IFRS Interpretations Committee are getting longer and are starting to answer specific fact patterns. These Board members were concerned about the risks that this poses to the Interpretations Committee.

The meeting concluded with a continuation of the Board’s discussions on the Business Combinations Under Common Control (BCUCC) project. The Board supported including within the project scope transactions that are preceded by an external acquisition and/or followed by an external sale of one or more of the combining entities and transactions that are conditional on a future sale such as in an IPO. Board members also indicated that one method should be used to account for BCUCCs and no choice should be given.


Agenda for the meeting

Wednesday 13 December 2017

Afternoon session (13:45–17:00)

  • Primary financial statements
    • Objective and location of the management performance measure
    • Classification of interest and dividends in the statement of cash flows
    • Consistent starting point for the indirect reconciliation of cash flows and potential alignment of the operating section across the statement of cash flows and the statement(s) of financial performance
  • Disclosure initiative: Education session
    • Principles of Disclosure—Preliminary comment letter overview

Thursday 14 December 2017

Morning session (10:15–12:45)

  • Goodwill and impairment
    • Subsequent accounting for goodwill
    • Improving effectiveness of the impairment testing model in IAS 36
    • Courses of action for improving application of IAS 36
    • Possible simplifications to the impairment testing model in IAS 36
  • Rate-regulated activities
    • Summary of information received from the Consultative Group

Afternoon session (13:30–17:30)

  • Dynamic risk management
    • Proposed project plan
  • IFRS implementation issues
    • IFRIC Update
    • Costs considered in assessing whether a contract is onerous (IAS 37)
    • Accounting policy changes (IAS 8)
    • Possible narrow-scope standard-setting (IFRS 1)
    • Proceeds before intended use (IAS 16)
  • Business combinations under common control

Agenda papers for this meeting are available on the IASB's website.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.