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News

IASB meeting (blue) Image

April 2017 IASB meeting notes posted

27 Apr 2017

The IASB met at its offices in London on 24 and 27 April 2017. We have posted our comprehensive Deloitte observer notes for all projects discussed during the meeting.

The following topics were discussed at the meeting:

  • Insurance contracts.
  • Rate-regulated activities.
  • Financial performance reporting.
  • IFRS implementation issues.
  • Definition of a business.

Please click to access the detailed notes taken by Deloitte observers for the entire meeting.

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IASB chair speaks on integrated reporting

27 Apr 2017

At the International Integrated Reporting Council’s (IIRC) council meeting, IASB chair Hans Hoogervorst discussed the IASB’s approach to wider corporate reporting landscape as well as the IASB’s conceptual framework and practice statement on management commentary related to integrated reporting.

Mr Hooger­vorst began by saying that the IASB is currently examining what the future role of IASB should be in regards to wider corporate reporting. The IASB initiated discussions during its March 2017 meeting. He mentioned that certain information that is needed by users to determine an entity’s value, such as a company’s intangibles, are not recognized in the financial statements. As stated in the IASB’s conceptual framework, the “general purpose financial reports are not designed to show the value of a reporting entity.” Mr Hoogervorst noted that additional useful information needed to determine an entity’s value is often found integrated reporting.

In addition, Mr Hoogervorst discussed the IASB’s 2010 Management Commentary Practice Statement. He stated that the practice statement encouraged managers to provide important context for the financial statement. This context is also considered an important component of integrated reporting. He concluded that there is “common ground between financial and integrated reporting.”

Lastly, he discussed that additional guidance has been issued by the UK Financial Reporting Council’s Strategic Report Guidance and the IIRC’s International <IR> Framework and that based on these documents as well as other considerations, the IASB may consider updating its practice statement.

For more in­for­ma­tion, see the speech on the IASB’s website.

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FRC issues a Discussion Paper on the role of auditors and preliminary announcements

27 Apr 2017

The Financial Reporting Council (FRC) has issued a Discussion Paper on the role of auditors and preliminary announcements.

The FRC indicates that the Discussion Paper is intended to “stimulate a discussion about ways to enhance the value of preliminary announcements and any assurance provided in respect of those announcements to the user community”.  The FRC will use feedback on the Discussion Paper to drive revisions to the auditor guidance contained in Bulletin 2008/2 The Auditor’s Association with Preliminary Announcements made in Accordance with the Requirements of the UK and Irish Listing Rules which was last updated in 2008. 

The FRC is also conducting outreach work “to understand the extent to which investors in the UK are satisfied or dissatisfied with the tone, content and style of preliminary reports and to identify if improvements could be made”. 

The Discussion Paper identifies some of the options which have been identified in the course of the FRC’s initial outreach as to how the existing guidance might best be revised and provides the opportunity to hear the views of a wider range of stakeholders.

The Discussion Paper includes:

  • a brief summary of the key legislative and regulatory requirements which relate to preliminary announcements;
  • analysis of current practice in the LSE Main Market and AIM Markets, based on a survey of c180 companies; and
  • an evaluation of the current guidance and options for change.

Comments on the Discussion Paper are requested by 23 June 2017.

The press release and Discussion Paper are available on the FRC website.

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FRC consults on proposals to update guidance on bank reports for audit purposes

27 Apr 2017

The Financial Reporting Council (FRC) has issued a consultation to make minor revisions to ISA (UK) 330 (revised June 2016) – ‘The Auditor’s Response to Assessed Risks’ and ISA (UK) 505 – ‘External Confirmations’.

These proposals will result in the withdrawal of Practice Note 16 – Bank Reports for Audit Purposes in the United Kingdom which the FRC says is “rather dated and is no longer needed to support the work of auditors seeking bank confirmations to support an audit engagement”. 

The proposed changes, which the FRC says do not affect the work effort required of auditors, would apply to the audit of financial periods beginning on or after 15 December 2017.Comments are requested by 26 May 2017.

The press release and full consultation are available on the FRC website. 

EFRAG (European Financial Reporting Advisory Group) (dk green) Image

EFRAG Board conference call May 2017

27 Apr 2017

The European Financial Reporting Advisory Group (EFRAG) will hold a Board conference call on 3 May 2017.

An agenda with supporting papers can be found on the EFRAG website.

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Summary of the March 2017 ASAF meeting now available

26 Apr 2017

The staff of the International Accounting Standards Board (IASB) have made available a summary of the discussions of the Accounting Standards Advisory Forum (ASAF) meeting held in London on 6 and 7 March 2017.

The topics covered during the meeting were the following (numbers in brackets are ref­er­ences to the cor­re­spond­ing para­graphs of the summary):

  • Rate-regulated activities (1–12): ASAF members were updated on the IASB recent discussions on rate-regulated activities, specifically commenting on the new accounting model’s core principle, supplementary approach, scope, and criteria for recognizing regulatory assets and liabilities.
  • Definition of a business (13–19): ASAF members provided comments on a proposed screening test in the Exposure Draft Definition of a Business and Accounting for Previously Held Interests (ED/2016/1). The members discussed whether the screening test should be determinative, a rebuttable presumption, or an indicator.
  • Conceptual framework (20–40): ASAF members discussed certain proposed concepts for the conceptual framework, which included asymmetry, reporting entity, definition of a liability, executory contracts, and other comments and questions.
  • Insurance contracts (41–48): ASAF members commented on different methods to support the implementation of the upcoming insurance contracts standard. These methods include the publishing of educational and explanatory material, webcasts and conferences. In addition, they discussed the role of the transition resource group will have in the implementation of the new standard.
  • Dynamic risk management (49–52): The EFRAG presented its results from outreach related to a bank’s interest rate risk management and dynamic risk management.
  • Financial instruments with characteristics of equity (53–57): ASAF members discussed the illustrative examples provided in the upcoming discussion paper on financial instruments with characteristics of equity project. In addition, the ASAF provided several general suggestions on the upcoming discussion paper.
  • Symmetric prepayment options (58–63): An overview of the IASB’s tentative decisions on the proposed narrow-scope amendment to IFRS 9. In general, the ASAF supported the proposal.
  • Primary financial statements (64–69): The IASB staff updated the ASAF on tentative decisions concerning the project scope and future topics.
  • Disclosure initiative (70): ASAF members received an update on the upcoming discussion paper Principles of Disclosure.
  • Project updates and agenda planning (72): ASAF members were updated on current IASB projects.

A full summary of the meeting is available on the IASB's website.

EFRAG (European Financial Reporting Advisory Group) (dk green) Image

EFRAG draft comment letter on proposed improvements to IFRS 8

26 Apr 2017

The European Financial Reporting Advisory Group (EFRAG) has issued a draft comment letter on the IASB exposure draft ED/2017/2 'Improvements to IFRS 8 'Operating Segments' (Proposed amendments to IFRS 8 and IAS 34)'.

EFRAG broadly agrees with the IASB proposals; however, EFRAG has reservations regarding the proposal to require an entity to explain why the segments identified in an entity's financial statements are different to the segments reported outside of the financial statements. EFRAG also believes that the proposed definition of an entity's 'annual reporting package' may prove difficult to apply in practice. The background of both these concerns is that EFRAG believes that the IASB might be trying to achieve something that goes beyond its mandate.

Comments on EFRAG's draft comment letter are requested by 17 July 2017. For more information, see the press release and the draft comment letter on the EFRAG website.

IASB (International Accounting Standards Board) (blue) Image

IASB video on loan loss accounting and financial stability

25 Apr 2017

The IASB has released a video on loan loss accounting requirements, financial stability, and the relationship between IFRS 9 and bank regulators’ capital requirements. The topics are discussed by IASB Vice-Chair Sue Lloyd as well as IASB members Stephen Cooper and Darrel Scott.

The video is available on the IASB’s website.

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IFRS Foundation Annual Report 2016

25 Apr 2017

The IFRS Foundation (IFRSF) has published its Annual Report for 2016, titled 'Better Communication in Financial Reporting'.

The report for 2016 provides an overview of the IFRS Foundation’s activities during the year and sets out the Foundation’s plans for 2017 and beyond. The report addresses in particular the large projects that are set for completion (Insurance contracts and Conceptual Framework).

Please click to download the report from the IASB's website.

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IPSASB review of developments 2015-2016

25 Apr 2017

The International Public Sector Accounting Standards Board (IPSASB) has published '2015-2016 Biennial Review: Sustaining the Momentum'.

The publication summarises the IPSASB’s achievements, challenges, and key developments in 2015 and 2016 and can be downloaded from the IPSASB website.

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