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EFRAG publishes its final comment letter on the Annual Improvements to IFRS Standards 2018-2020 Cycle

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

23 Aug 2019

The European Financial Reporting Advisory Group (EFRAG) has issued its final comment letter on the IASB's Exposure Draft ED/2019/2 Annual Improvements to IFRS Standards 2018-2020 Cycle.

EFRAG "generally agrees with the proposals in the ED and considers that these minor changes will improve the consistency and understandability of the IFRS standards concerned", with the following comments:

  • EFRAG suggests that the IASB should clarify that the amendment to paragraph D16 does not prevent a first-time adopter from using the exemption enabling it to set the cumulative translation differences at zero at the date of transition to IFRSs;
  • EFRAG recommends that IAS 39 Financial Instruments: Recognition and Measurement be amended in the same way as the amendment proposed to IFRS 9 Financial Instruments. It also considers that the phrase "including fees paid or received by either the borrower or the lender on the other's behalf" is unclear and recommends that an example of such fees is provided; and
  • EFRAG advises that additional guidance should be added to IFRS 16 on where the reimbursement of leasehold improvements may be considered as a lease incentive.

For more information, see the press release and final comment letter on the EFRAG site.

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