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Summary of the September 2016 ASAF meeting now available

  • ASAF meeting (mid blue) Image

11 Nov 2016

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 29 September 2016.

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

  • Research report Information Needs of Users of New Zealand Capital Markets Entity Reports (1-20): This was a research report from New Zealand. In addition to the research results the ASAF members also discussed the research methodology (small sample, limitations regarding the questions asked), which does not necessarily make the research results applicable in other jurisdictions. ASAF members supplemented the results with insights from their own jurisdictions.
  • Rate-regulated activities (20-36): ASAF members discussed to agenda papers on this topic: (i) Research on the economic value of financial information on rate-regulated activities (prepared by Canada) and (ii) Accounting for rate-regulated activities from a conceptual perspective (prepared by Korea). During the discussion of the Canadian paper, ASAF members explained the situation in their respective jurisdictions. ASAF members agreed that it is important for users of financial statements to receive information about the entity’s rights and obligations created by the rate regulation. Where that information should be made availabe (primary financial statements or notes) remained contentious. The Korean paper explored how the Conceptual Framework and IFRS 15 could be used as a starting point for developing a new accounting model to report the financial effects of rate regulation. ASAF members agreed that developing a new accounting model might be useful and thought the Korean approach promising. However, concerns and comments were also voiced.
  • Conceptual Framework (37-62): ASAF members discussed the Conceptual Framework project comprehensively. Several papers had been submitted for discussion: (i) a paper on measurement prepared and presented by EFRAG (different ASAF memebrs supported different points raised in this paper), (ii) an IASB staff draft of proposed revisions to the discussion of factors to be considered in selecting a measurement basis (the new wording rather met with resistance from ASAF members), (iiI) an update on the Board’s tentative decisions on presenting info rmation about financial performance, and (iv) a paper on financial performance and measurement prepared by the ASBJ.
  • Definition of a business (63-71): ASAF members were informed about the corresponding FASB project and compared it with the IASB exposure draft. They encouraged IASB and FASB to align the wording of their amendments as much as possible and suggested that IASB clarify in the basis for conclusions that even though the IASB wording is different from the FASB wording, it is intended to have the same outcome. Regarding the IASB exposure draft, some inconsistencies and unintended consequences were pointed out.
  • Project updates and agenda planning (72-73): ASAF members were updated on current IASB projects. Topics suggested for the agenda of the next meeting were cryptocurrencies, an update on the forthcoming insurance contracts standard, and a general discussion on their research activities.
  • Working with National standard-setters (74-78): Discussion of this topic was short and onesided as ASAF members were only asked to identify entities in their jurisdictions that have improved how they communicate in their financial statements and would be willing to be included as examples in a report of the IASB staff. ASAF members asked clarifying questions and pointed out other reports that have been published in this area.
  • Feasibility Studies (79-80): This point merely clarified what the IASB staff calls feasibility studies: An informal label to reflect that the staff is looking into whether limited amendments can be achieved with a given approach where implementing the approach is not expected to require extensive drafting.

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

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