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IASB issues podcast on latest Board developments

23 Nov 2017

The IASB has released a podcast featuring Chair Hans Hoogervorst, Board members Nick Anderson and Ann Tarca, and education director Matt Tilling to discuss the deliberations at the November 2017 IASB meeting.

The 15 minute podcast features discussions of the following topics:

  • Primary financial statements
  • Wider corporate reporting
  • Improvements IFRS 8 Operating Segments
  • Dynamic risk management

The podcast can be accessed through the press release on the IASB website. More information on the topics discussed is available through our comprehensive notes taken by Deloitte observers of the November 2017 Meeting.

EFRAG calls for participants in IFRS 17 case study

22 Nov 2017

In connection with its endorsement advice on IFRS 17 'Insurance Contracts', the European Financial Reporting Advisory Group (EFRAG) will undertake a detailed case study on the anticipated impact of IFRS 17 on a sample of European insurance groups.

EFRAG is therefore calling for volunteers to participate in such a case study and is seeking the participation of a range of entities involved in providing insurance. The focus of the study is on European insurance groups that apply IFRSs under the provisions of the IAS Regulation.

Expressions of interest are requested by 8 December 2017. Please see the press release on the EFRAG website for more information.

Recent sustainability and integrated reporting developments

22 Nov 2017

A summary of recent developments at IASB, GRI/CSR Europe/Accountancy Europe, and CDP.

A new project Management commentary (Wider corporate reporting) has been added to the IASB's agenda. The aim of the project is to review and update the Management Commentary Practice Statement issued in 2010 to help address the lack of alignment and integration between wider corporate reporting and financial reporting.

An Accountancy Europe hosted event this afternoon will see the launch of a new publication Policy & Reporting: Member State Implementation of the Directive 2014/95/EU, developed by CSR Europe and the Global Reporting Initiative (GRI) with the support of Accountancy Europe. The publication provides a high-level overview of the similarities and differences in national transposition of the Directive across Europe – including scope, reporting features, auditor’s involvement and fines. The event will also feature a panel discussion What role does the non-financial reporting play in the future of corporate reporting? More information is available here (please scroll down to the Wednesday, 22 November, 16:00-18:30 event.)

GRI also announces that Eric Hespenheide, former Deloitte Partner, has been appointed as the Chairman of the GRI Board of Directors, effective 1 January 2018. The press release is available here.

The Carbon Disclosure Project (CDP) has released to national editions of its 2017 Climate Change report analysing data disclosed by companies. Please click through for the individual reports on the CDP website:

IFRS Interpretations Committee holds November 2017 meeting

21 Nov 2017

The IFRS Interpretations Committee met in London on Monday 20 November 2017. We have posted Deloitte observer notes for the technical issues discussed during this meeting.

The Committee discussed six issues, including three new interpretation requests.

Finalisation of draft agenda decisions

The Committee consider the public feedback on a request related to IFRS 3 Business Combinations on the acquisition of a group of assets, and decided to finalise the decision not to add to its agenda. However the IASB will monitor this issue and proactively seek feedback from stakeholders on the significance of the issue after the revised definition of a business takes effect.

Continued discussions

In its September 2017 meeting, the IC tentatively decided to add a project to clarify the meaning of the term ‘unavoidable costs’, which is used in the definition of an onerous contract in IAS 37 Provisions, Contingent Liabilities and Contingent Assets. The staff recommended that the clarification be by way of an amendment to IAS 37 and that the scope of the project be limited to clarifying the meaning of ‘unavoidable costs’, and not consider broader issues related to identifying or measuring an onerous contract. The Committee agreed with the Staff’s recommendation but decided to leave open what form the clarification should take until the project is more mature.

In its September 2017 meeting, the IC asked the Staff to research into the scope of a potential narrow-scope amendment to IFRS 1 First Time Adoption of International Financial Reporting Standards with the aim of reducing compliance costs when a subsidiary becomes a first-time adopter later than its parent. The Staff recommended amending IFRS 1 to allow a subsidiary that applies paragraph IFRS 1.D16(a) to measure cumulative translation differences using the amounts reported by the parent based on the parent’s date of transition to IFRS. The Committee supported that recommendation but the Staff will provide further analysis on whether IFRS 1 should require or permit the subsidiary to measure CTD based on the parent’s reported amounts.

New issues

There were three new issues. Two relate to IFRS 15 Revenue from Contracts with Customers:

  • Revenue recognition in a real estate contract that includes the transfer of land
  • Right to payment for performance completed to date

The third relates to IAS 1 Presentation of Financial Statements and IFRS 9 Financial Instruments:

  • Presentation of interest revenue for particular financial instruments

For all three issues the Committee tentatively decided not to add the issue to its agenda. The draft Agenda Decisions will be published in IFRIC Update.

Future items

The Staff are analysing requests received on whether a dual currency bond meets the solely payments of principal and interest condition in IFRS 9; whether an instrument for which the notional amount varies depending on the outcome of a transaction can be a hedging instrument applying IFRS 9; and how the initial recognition exemption in paragraphs 15 and 24 of IAS 12 applies to the recognition of right-of-use assets and lease liabilities arising under IFRS 16.

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

We comment on two IFRS Interpretations Committee tentative agenda decisions

20 Nov 2017

We have published our comment letters on IFRS Interpretations Committee tentative agenda decisions on IFRS 15 and IAS 28, as published in the September 2017 IFRIC Update.

More in­for­ma­tion about the issues is set out below:


Agenda decision supported?

More in­for­ma­tion

IFRS 15Revenue recognition in a real estate contract 

Yes, however, we recommend an amendment to the wording in the tentative agenda decision to highlight the distinction between control of an asset and of a right to sell or pledge that asset in the future.  

IAS 28Contributing property, plant and equipment to an associate


Click to access all our comment letters to the IASB, IFRS Foun­da­tion, and IFRS In­ter­pre­ta­tions Committee.

EFRAG feedback statement on the IASB’s DP on Principles of Disclosure

20 Nov 2017

The European Financial Reporting Advisory Group (EFRAG) has published its feedback statement in relation to the IASB's Discussion Paper DP/2017/1 ‘Disclosure Initiative – Principles of Disclosure’.

EFRAG published its final comment letter in October 2017.

The feedback statement describes the main comments received by EFRAG in response to its draft comment letter and how these comments were considered by EFRAG in finalising its final comment letter to the IASB.

The press release and full feedback statement are available on the EFRAG website.

FRC revises Practice Note 11

20 Nov 2017

The Financial Reporting Council (FRC) has issued a revised Practice Note 11: ‘The Audit of Charities in the United Kingdom’.

The main drivers for the revisions are:

  • revisions to UK auditing standards (ISAs (UK));
  • changes to UK accounting standards (Financial Reporting Standard (FRS) 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland) and the revision of the charities Statement Of Recommended Practice (SORP);
  • continuing developments in regulation and guidance issued by the Charity Regulators; and
  • changes in relevant legislation. 

The press release and revised Practice Note 11 are available on the FRC website.

FRC announces thematic reviews for 2018/2019

20 Nov 2017

The Financial Reporting Council (FRC) has announced the thematic reviews that it will undertake in 2018/19.

The thematic reviews, which will supplement the FRC’s routine monitoring work, will cover “certain aspects of corporate reports and audits where there is a particular shareholder interest, and scope for improvement and learning from good practice”.

Within the areas of corporate reporting the FRC will undertake thematic reviews in the following areas:

The FRC has indicated that it will write to 40 smaller listed and AIM quoted companies prior to their year-end, informing them that it will review two specific aspects of their next published report and accounts. These specific aspects will be drawn from five areas of FRC focus that have featured in recent thematic reviews or Financial Reporting Lab reports.

The FRC will also review and report on companies’ disclosures in December 2017 reports in relation to the future impact of IFRS 16 Leases and will also review June 2018 interim reports of a number of companies in industries whom it expects that IFRS 15 Revenue from Contracts with Customers and IFRS 9 Financial instruments will have the most material impact.

Within the area of audit, thematic reviews will be conducted in the following areas:

  • Transparency Reporting: A comparative analysis of transparency reports of firms with public interest entity (PIE) audits.
  • Audit Quality Indicators (AQIs): An assessment of the development and use of AQIs by UK audit firms, which will draw heavily on international best practice.

In addition to the thematic reviews, noted above, the FRC will focus its routine corporate reporting review and audit monitoring activity on the reports and audits in the priority sectors of:

  • financial Services, with particular emphasis on banks, other lenders and insurers;
  • oil and gas;
  • general retailers; and
  • business support services.

It will particularly focus on:

  • first and last year audits;
  • the audit of fair value investments, including goodwill impairment;
  • the nature and extent of the use of auditor’s experts and specialists; and
  • the approach to the audit of controls.

Click for (all links to the FRC website):

IASB discusses investors’ reactions to IFRS 17

20 Nov 2017

The IASB has issued an article by IASB board member Nick Anderson that discusses the top five question investors and analysts have on IASB’s new insurance contracts standard, IFRS 17.

The five questions discussed include:

  1. Will IFRS 17 affect dividend payouts?
  2. How can a principle-based Standard like IFRS 17 improve comparability between insurers?
  3. Will IFRS 17 bring global comparability to the insurance sector?
  4. What are the main differences between IFRS 17, regulatory reporting and embedded value reporting?
  5. How will removing insurance premiums from the income statement improve comparability?

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

Agenda for the December 2017 ASAF meeting

20 Nov 2017

The International Accounting Standards Board (IASB) has released an agenda for the meeting of the Accounting Standards Advisory Forum (ASAF), which is to be held at the IASB's offices in London on 7 and 8 December 2017.

The agenda for the meeting is sum­marised below:

Thursday, 7 December 2017 (9:00-17:15)

  • Primary financial statements.
    • Introduction of an investing category into the statement of financial performance.
    • Defining finance income/expenses.
    • Improving the presentation of OCI.
  • Disclosure initiative — Definition of material (proposed amendments to IAS 1 and IAS 8).
  • Disclosure initiative — Principles of disclosure — Overview and next steps.
  • Post-implementation review of IFRS 13 Fair Value Measurement — Overview on feedback and next steps.
  • Wider corporate reporting — Update from IASB discussions.
  • Academic liaison — Strategy session.
  • Information deficiencies and consolidated financial statements — Impact of consolidation on information content.

Friday, 8 December 2017 (10:10-13:45)

  • Improvements to IFRS 8 Operating Segments (Proposed amendments to IFRS 8 and IAS 34) — Explore possible alternative approaches and next steps.
  • Business combinations under common control — Update on the project and discussions on the scope and the appropriate accounting method for transactions.
  • Project updates and agenda planning.

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

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