July

Deloitte releases e-learning module on impairment requirements of IFRS 9

10 Jul, 2015

Deloitte’s Global Audit Learning group has released an e-learning module on the impairment requirements of IFRS 9. This new module is an addition to the extensive catalogue of IFRS e-learning content made freely available by Deloitte.

The new IFRS 9 module provides training in the background, scope and principles relating to the impairment of financial instruments under IFRS 9 Financial Instruments.

Deloitte also offers e-learning modules on

The IFRS e-learning modules are available free of charge and may be used and distributed freely, without alteration from the original form and subject to the terms of the Deloitte copyright over the material.

For details on the full range of e-learning modules go to Deloitte’s IFRS e-learning website. A listing of available e-learning modules is also available on our UK Accounting Plus IFRS e-learning page.

Joint outreach event on the Conceptual Framework

10 Jul, 2015

On 16 September 2015, the European Financial Reporting Advisory Group (EFRAG), the Norwegian Accounting Standards Board (NRS), and the IASB will host a joint outreach event on the Conceptual Framework in Oslo.

The event is designed to offer an opportunity to discuss the proposals in the IASB Exposure Draft ED/2015/3 Conceptual Framework for Financial Reporting. The event will start with an introduction and an explanation of the key issues in the paper and will be followed by an open debate from the floor.

Please click to access the formal invitation on the EFRAG website.

FASB votes to defer the effective date of new revenue standard

09 Jul, 2015

At its meeting today, the FASB affirmed its proposal to defer for one year the effective date of the new revenue standard (ASU 2014-09, "Revenue From Contracts With Customers") for public and nonpublic entities reporting under U.S. GAAP. In addition, the FASB affirmed that all entities would be permitted to early adopt the standard as of the original effective date in ASU 2014-09 (i.e., annual reporting periods beginning after December 15, 2016).

The FASB has directed its staff to prepare a final Accounting Standards Update for vote by written ballot. For more in­for­ma­tion, see the ten­ta­tive board de­ci­sions on the FASB's website.

The IASB has recently concluded the comment period on its proposed deferral and will discuss the feedback at a future meeting. Comments received so far seem to support the proposal.

AOSSG warns against delaying effective dates

09 Jul, 2015

The Asian-Oceanian Standard-Setters Group (AOSSG) has commented on the International Accounting Standards Board's (IASB) Exposure Draft ED/2015/2 'Effective Date of IFRS 15'. The AOSSG supports deferring the effective date in this case but warns the IASB against setting 'a precedent for constituents seeking amendments to the effective date of other standards, whenever the implementation is found to be challenging'.

The IASB proposed deferring the effective date of IFRS 15 in May 2015 to give entities additional time to implement targeted amendments to IFRS 15 Revenue from Contracts with Customers that the IASB has tentatively decided on and to acknowledge that IFRS 15 was issued later than had been intended, so implementation time was shorter than anticipated in the first place. Although the AOSSG sees the validity of these arguments it believes that the IASB should try to avoid similar cases in the future:

In principle, the AOSSG believes that the IASB should undergo sufficient due process to carefully consider every aspect of the standard (including the effective date) before finalising the standard. Although the AOSSG generally agrees with the need to extend the effective date for this case, the AOSSG encourages the IASB to seek to improve its due process based on the lessons learnt, such that the IASB will minimize the risks of delaying the effective date in future standards.

The AOSSG makes two suggestions how this could be achieved:

  • The IASB could introduce a protocol to redeliberate the effective date when the issuance of the standard is later than originally anticipated or to defer the final decision of the effective date until immediately before the issuance of the standard.
  • The IASB could set a formula for determining the implementation lead-time when it decides on the effective date.

Please click to access the comment letter on the AOSSG website.

Basel Committee issues revised corporate governance principles for banks

08 Jul, 2015

The Basel Committee (“the Committee”) has today issued revised principles on corporate governance for banks (“the revised principles”). The revised principles build on the Committee's 'Principles for enhancing corporate governance', published in 2010.

Effective corporate governance is critical to the proper functioning of a bank, the banking sector and the economy.  The Committee’s revised principles “provide a framework within which banks and supervisors should operate to achieve robust and transparent risk management and decision-making and, in doing so, promote public confidence and uphold the safety and soundness of the banking system”. 

The revised principles, which have been developed after a consultation in October 2014:

  • expand the guidance on the role of the board of directors in overseeing the implementation of effective risk management systems;
  • emphasise the importance of the board's collective competence as well as the obligation of individual board members to dedicate sufficient time to their mandates and to keep abreast of developments in banking;
  • strengthen the guidance on risk governance, including the risk management roles played by business units, risk management teams, and internal audit and control functions (the three lines of defence), as well as underline the importance of a sound risk culture to drive risk management within a bank;
  • provide guidance for bank supervisors in evaluating the processes used by banks to select board members and senior management; and
  • recognise that compensation systems form a key component of the governance and incentive structure through which the board and senior management of a bank convey acceptable risk-taking behaviour and reinforce the bank's operating and risk culture.

The press release and revised principles are available from the website of the Bank for International Settlements.

IFRS Foundation Trustees hold June 2015 meeting

08 Jul, 2015

The IFRS Foundation trustees met in London on 18–19 June 2015.

Meeting ac­tiv­i­ties in­cluded the fol­low­ing:

  • Ex­ec­u­tive session — The trustees and IFRS Foundation Monitoring Board were updated on (1) governance developments, (2) due-process activities, (3) the IFRS Foundation’s financial situation, and (4) the IASB’s technical activities and mission statement. In addition, the trustees discussed significant international developments concerning use of IFRSs in Europe, the Americas, Asia-Oceania, Africa, and the Middle East. Further, the trustees were updated on the (1) progress of the IFRS Foundation’s review of its structure and effectiveness and (2) nominations of new ASAF members.
  • IASB chair­man’s report — IASB Chairman Hans Hoogervorst gave an update on the IASB’s progress on its conceptual framework, leases, disclosure initiative, and insurance projects.
  • Report of the Due Process Over­sight Com­mit­tee (DPOC) — Jim Quigley led a discussion about the DPOC’s June 2015 meeting. For more in­for­ma­tion, see our related news item.
  • Tommaso Padoa-Schioppa lecture — The IFRS Foundation jointly hosted an event with the European University Institute to discuss “systemic drivers of the 2008 financial crisis” and proposed reforms.

The full report on the IFRS Foun­da­tion trustees’ meeting is avail­able on the IASB’s website.

Due Process Oversight Committee holds June 2015 meeting

08 Jul, 2015

The Due Process Oversight Committee (DPOC) met in London on 18 June 2015.

Meeting ac­tiv­i­ties in­cluded the fol­low­ing:

  • Updates on tech­ni­cal ac­tiv­i­ties — The DPOC was updated on (1) the activity of the IASB’s and FASB’s joint transition resource group (TRG) for revenue recognition; (2) some of the IASB’s major projects, including leases, insurance contracts, the conceptual framework, macro hedging, rate-regulated activities, and inflationary environments; and (3) progress made on the IASB’s agenda consultation.
  • IFRS Taxonomy — The DPOC analyzed two trials that the IASB conducted to assess proposed changes to the due process for the IFRS taxonomy and was pleased with the direction the IASB has taken.
  • Review of Con­sul­ta­tive group — The DPOC reviewed various consultative groups (e.g., the ASAF, the revenue recognition TRG) to determine their effectiveness and ultimately concluded that most of the groups assessed were functioning well.
  • Due process protocol — The DPOC discussed a report on the availability of comment letters that the IASB and IFRS Interpretations Committee have received, the availability of the IASB’s agenda papers, and the relationship between the IASB and IFRS Foundation and securities regulators.
  • Cor­re­spon­dence — No new correspondence has been received since the DPOC’s previous meeting.

The full report on the DPOC meeting is avail­able on the IASB’s website.

EFRAG publishes consultation document on the IASB Exposure Draft of a new Conceptual Framework

08 Jul, 2015

The European Financial Reporting Advisory Group (EFRAG) has published a document for public consultation on the proposed new Conceptual Framework for Financial Reporting.

The International Accounting Standards Board (IASB) published the comprehensive Exposure Draft ED/2015/3 Conceptual Framework for Financial Reporting containing proposals for topical areas where it considers a revision and amendment of the existing Conceptual Framework necessary on 28 May 2015. Included in the ED are proposals to revise the definitions of an asset and a liability, to introduce guidance on measurement and derecognition, and to set a framework for presentation and disclosure.

The consultation document published by EFRAG today seeks constituents' views on issues related to the ED. It contains preliminary positions of the EFRAG Board to facilitate discussion.

Generally, the view presented is that the Conceptual Framework as drafted in the ED would fail to meet European expectations. Cited are a lack of guidance, in particular on controversial issues that have discussed in the past (how to select a measurement basis and how to report performance, including what should be reported in profit or loss and when). EFRAG welcomes the greater emphasis given to stewardship and the reintroduction of prudence, however, it feels that more needs to be done in these two areas. EFRAG also disagrees with changing the qualitative characteristics of relevance and reliability instead of seeking a common understanding with constituents of what constitutes a reliable measurement.

The consultation document also indicates that EFRAG intends to request that the IASB extends its deadline for comments by 2 months (up to 26 December 2015) given the critical role the conceptual framework is intended to play in the effectiveness of the IASB standard-setting process in the future.

EFRAG requests comments on its consultation document by 26 October 2015 (possibly extended to 20 November if the IASB grants an extended comment period).

Please click to access the following documents on the EFRAG website:

Revenue transition resource group releases meeting agenda

07 Jul, 2015

The IASB and FASB released the agenda for the upcoming meeting of their joint revenue transition resource group (TRG), which will be held on 13 July 2015.

The purpose of the TRG is to seek feed­back on po­ten­tial issues related to im­ple­men­ta­tion of the boards’ new revenue stan­dard. By an­a­lyz­ing and dis­cussing po­ten­tial im­ple­men­ta­tion issues, the TRG will help the boards de­ter­mine whether they need to take ad­di­tional action, such as pro­vid­ing clar­i­fi­ca­tion or issuing other guid­ance.

The agenda for the meeting is as follows:

Monday, 13 July 2015

  • In­tro­duc­tory remarks
  • Project updates
  • Consideration payable to a customer
  • Credit cards
  • Portfolio practical expedient and application of variable consideration constraint
  • Completed contracts at transition
  • Application of the series provision and allocation of variable consideration
  • Practical expedient for measuring progress toward complete satisfaction of a performance obligation
  • Measuring progress when multiple goods or services are included in a single performance obligation
  • Determining when control of a commodity transfers
  • Accounting for restocking fees and related costs

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

Trustees launch review of aspects of the IFRS Foundation Constitution

07 Jul, 2015

The Trustees of the IFRS Foundation have published a Request for Views document with proposals for further enhancing the structure and effectiveness of the organisation.

The IFRS Foundation Constitution requires the IFRS Foundation Trustees to undertake a review of the entire structure of the IFRS Foundation and its effectiveness every five years. As announced last year, the Trustees are convinced that the last strategy review (2010-2012) already covered many issues that would be part of a Constitution review. Therefore, the Trustees have limited this review to three strategic areas:

  • Relevance of IFRS
    • to consider whether the IASB should extend its remit beyond the current focus of the organisation, either in terms of the types of entity covered or the types of reporting;
    • to seek views on the Foundation's strategy for the IFRS Taxonomy; and
    • to consider the impact of developments in technology on maintaining the relevance of IFRS
  • Consistent application of IFRS
    • to consider whether the Foundation is doing the right things to support the consistent application of IFRS and whether there is anything more it could and should be doing in this area;
  • Governance and financing of the IFRS Foundation
    • to consider the current governance structure of the Foundation, including the functioning of the three-tier structure;
    • to review the provisions in the Constitution that relate to the Trustees’ geographical distribution, how to ensure an appropriate balance of professional backgrounds, and their terms of appointment;
    • to consider the focus and the frequency of the reviews of structure and effectiveness specified in the Constitution;
    • to review the provisions in the Constitution that relate to the IASB, including the optimum size of the Board and its geographical distribution, the balance between full-time and part-time members and their professional backgrounds, and their terms of appointment; and
    • seeking views on the Foundation’s funding model and how its functioning might be strengthened.

The Trustees believe that it is not necessary to open up all aspects of the Foundation for consultation and decided not to cover the primary objective of the Foundation and the processes and procedures in support of that objective, including the IASB's due process; what the Foundation and the IASB are doing in support of its commitment to the long-term goal of the adoption of IFRS; and the operations and performance of the Advisory Council.

Comments on the Request for Views document are requested by 30 November 2015. Please click for the following information on the IASB website:

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