Administrative Session — Work in progress

Date recorded:

The staff provided the Committee with an update on the current status of issues that are in progress but not to be discussed during the Committee’s January 2013 meeting. The Committee deferred work on three new issues and five outstanding issues. Additionally, the Committee did not discuss two issues included on its January 2013 agenda. All such issues will be discussed at future meetings.

The new issues include:

  • An IFRS 10 Consolidated Financial Statements issue requesting clarification of the concept of ‘protective rights’ in IFRS 10.
  • An IFRS 3 issue requesting clarification of whether a previously held interest in the assets and liabilities of a joint operation should be remeasured to fair value on acquiring control over the joint operation.
  • An IFRS 10 and IAS 32 Financial Instruments: Presentation issue requesting clarification on how puttable instruments that are non-controlling interests should be classified in consolidated financial statements.

The outstanding issues include:

  • An IFRS 3 issue requesting clarification on whether an asset with relatively simple associated processes meets the definition of a business in accordance with IFRS 3.
  • An IAS 12 Income Taxes issue requesting clarification of the accounting for deferred tax assets when an entity has deductible temporary differences relating to unrealised losses on debt instruments that are classified as available-for-sale financials assets and measured at fair value; is not allowed to deduct unrealised losses for tax purposes; has the ability and intention to hold the debt instruments until the unrealised loss reverses; and has insufficient taxable temporary differences and no other probable taxable profits against which the entity can utilise those deductible temporary differences.
  • An IAS 12 issue requesting clarification of the calculation of deferred tax in circumstances where the entity holds a subsidiary which has a single asset within it.
  • An IAS 19 issue regarding the accounting for employee benefit plans with a guaranteed return on contributions or notional contributions.
  • An IAS 2 Inventories issue requesting clarification on the accounting for long-term supply contracts of raw materials when the purchaser of the raw materials agrees to make prepayments to the supplier. The staff are monitoring this issue in the context of developments on the IASB’s revenue recognition project.

Issues included on the Committee’s January 2013 agenda which were not discussed at the meeting include:

  • Two staff papers related to application of IAS 7; one related to defining operating, investing and financing cash flows and another pertaining to the classification of interest paid that is capitalised as part of an asset.

An IAS 29 Financial Reporting in Hyperinflationary Economies issue requesting clarification about whether inflation accounting is permitted in IFRSs. The staff noted that it needed to perform additional analysis on the issue in responding to the question raised, and thus, would bring back the issue at a future date.

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