The present mandate period of six of the sixteen EFRAG TEG members expires on 31 March 2017 and the mandate of three country liaison members expires on 30 November 2016. All existing members are eligible for reappointment.

More information is available on the EFRAG website.

The ITCG discussed:

• update on the Board’s work to improve communication of financial information, including the IFRS Taxonomy;
• use of structured electronic reporting, including the IFRS Taxonomy;
• IFRS Taxonomy implementation guidance;
• IFRS Taxonomy content areas for review;
• IFRS Taxonomy educational materials; and
• ITCG member updates.

For more information, see the meeting notes on the IASB website.

Please click through for direct access to the notes:

Monday, 18 July 2016

• Insurance and IFRS 9
• IFRS Implementation issues
• Conceptual Framework

Tuesday, 19 July 2016

• Financial instruments with characteristics of equity
• Research programme
• Agenda consultation

You can also access the pre­lim­i­nary and un­of­fi­cial notes taken by Deloitte observers for the entire meeting.

One of the responses to the paper is also Deloitte's new Thinking Allowed publication on the future of corporate reporting.

Please click for access to all responses on the FEE website.

Local authorities in the United Kingdom are required to keep their accounts in accordance with ‘proper practices’. This includes compliance with the terms of the Code of Practice on Local Authority Accounting in the United Kingdom prepared by the CIPFA/LASAAC Local Authority Accounting Code Board (CIPFA/LASAAC). 

The exposure draft includes a number of key proposals for change including:

• Narrative reporting.  CIPFA/LASAAC propose to incorporate specific narrative reporting requirements into the Code from 2017/18.  It is CIPFA/LASAAC’s view that “narrative reporting requirements should encourage local authorities to tell their story and not be overly prescriptive in nature”.  The proposed amendments to narrative reporting are based on “high level principles”.  Proposed requirements have been derived by reference to the elements required in an Integrated Report and also by reference to the Financial Reporting Council’s (FRC’s) Guidance on the Strategic Report.
• Going concern reporting.  Changes are proposed to reinforce the requirements in relation to going concern.
• Review of accounting policies.  CIPFA/LASAAC propose to remove the list of accounting policies at paragraph 3.4.2.87 and to include more guidance for local authorities on the inclusion of significant accounting policies in the financial statements.  It is hoped that this will “encourage local authorities to avoid a ‘boilerplate’ approach to their significant accounting policies”.  CIPFA/LASAAC also encourage local authorities to “consider innovative ways of including their accounting policies in their financial statements to engage the users of the financial statements and ensure that the accounting policies tell the individual authority’s story”.   
• New disclosure of transaction costs for pension fund investments.  It is proposed that the current recommended disclosure at paragraph 6.5.5.2 in relation to disclosure for pension fund transaction costs be mandatory.  
• Consideration of the effects of a number of narrow scope amendments to International Financial Reporting Standards (IFRSs) including amendments to IAS 7 Statement of Cash Flows (Disclosure initiative) and IAS 12 Income Taxes (recognition of deferred taxes for unrealised losses)
• Legislative changes. 

The exposure draft also includes two proposed appendices for inclusion in the 2017/18 Code.  These appendices are in relation to provisions required to adopt IFRS 9 Financial Instruments and IFRS 15 Revenue from Contracts with Customers.  Both of these appendices will apply only to the 2018/19 Code but are proposed to be included to allow local authorities adequate time to prepare and understand the requirements of the new standards.

Comments on the exposure draft are invited until 7 October 2016.  

Click for (all links to the CIPFA website):

• Press release
• The 2017/18 Code of Practice on Local Authority Accounting in the United Kingdom - Invitation to comment 

An agenda and details on how to register for the meeting can be found on the EFRAG website.

In two volumes, the Handbook contains all IPSASB pronouncements published as of 30 January 2016, including the Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities. It can be downloaded free of charge in PDF format from the IPSASB website. The IPSASB points out that the print edition is currently in production and will be available for online ordering soon.

The location will be Brussels, the event will take place from 17:00 to 19:00. More information will be available at a later point of time. Please click for the announcement on the FEE website.

The overview report highlights that confidence in audit has improved.  The FRC comments: 

"On balance, there is a justifiably higher level of confidence in audit as a result of changes to independence requirements and the promotion of competition on the grounds of quality". 

Although the FRC highlight an improved level of confidence in audit, it indicates that “more needs to be done in terms of market competition and improving good practice in the profession”.  

The overview report identifies a number of “key influences” on confidence: 

• As a result of regulatory changes, audit firms are seen as more independent and competing for audit engagements in quality grounds.  However the report highlights that there is still a level of “concern” that the FTSE 350 audit market is still dominated by the Big Four Firms.
• Improved confidence is seen as a result of EU regulatory changes such as mandatory rotation and tighter provisions over the provision of non-audit services.  However the report does indicate that “there are concerns by some that the audit profession is becoming less attractive as a result of increased public and regulatory scrutiny”.  This, the report suggests, could deter future talent from joining the profession which may impact quality in the long-term.
• Results from the FRC’s audit monitoring and those of the other Recognised Supervisory Bodies (RSB’s) support that audit quality in the UK is improving.  In its review into audit quality in 2015/16 of FTSE 350 audits, the FRC assessed 77% as requiring “no more than limited improvements”.  The FRC expects this figure to be 90% by the end of its 2016/19 strategy.
• Large firms are now beginning to improve the effectiveness and efficiency of audits through the use of technology which the report highlights should “prompt further competition on quality”.  

The higher level of confidence in audit is supported by the report from YouGov.  The report follows up a 2014 survey which indicated varying degrees of confidence in audit depending on how close those stakeholders were to the day to day audit process.  The 2014 report indicated that those with less involvement in the day to day audit process did not share a high level of confidence.  Findings in 2016, show that “there is a sense of a higher level of confidence in audit than was seen in 2014”.  This is due improvements in audit since 2014 which have addressed various concerns raised by respondents in the 2014 survey.  However, like the FRC report, the YouGov report does highlight stakeholder concerns that would need to be addressed to further increase the level of confidence in audit.  

Click for:

• Press release (link to FRC website)
• Overview report - Developments in Audit 2015/16 – Overview (link to FRC website)
• Detailed report - Developments in Audit 2015/16 - Full report (link to FRC website)
• YouGov report - YouGov survey - Confidence in the Value of Audit (link to FRC website)
• Our previous UK Accounting Plus news item on the 2014 YouGov report

The consultation document requests views on whether stakeholders believe it is appropriate to adopt these ISAs or if there is an alternative approach to support the Prudential Regulation Authority’s (PRA) proposed requirement for mandatory external audit of elements of Solvency II public reporting in the insurance sector.

Solvency II is a new prudential regulation regime for the insurance industry which came into force across the EU on 1 January 2016. It contains a new requirement for an annual public report (called the Solvency and Financial Condition Report (SCFR)) by most medium and large insurance companies. In the UK, the PRA is currently consulting on rules which require external audits of elements of published SFCRs to the level of 'reasonable assurance.' The FRC has considered three options to support the provision of such reasonable assurance:

• An engagement carried out using International Standard on Assurance Engagement (ISAE) 3000: Assurance Engagements Other than Audits of Reviews of Historical Financial Information;
• An engagement carried out using ISAs; or
• An engagement carried out using a specifically developed assurance standard.

Analysis of current ISAs (UK) has revealed that reasonable assurance engagements over public Solvency II regulatory returns may be difficult to achieve. However such engagements could be contacted in accordance with ISA 800 and ISA 805. Having completed an impact assessment, the FRC does not believe that adoption of these ISAs will result in significant additional costs or add to the regulatory burden on business but is seeking stakeholder views through this consultation.

The consultation period is open until 5pm on 3^rd October 2016.

Click here to access the press release accompanying the consultation.

Click here to access the consultation document.