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

• Financial instruments with characteristics of equity (1–7): The ASAF discussed the various project alternatives and were supportive of the IASB’s decision to make clarifying amendments to IAS 32. Several members also expressed that a fundamental review to develop a new approach to distinguishing financial liabilities from equity is warranted.
• Dynamic risk management (8–16): The ASAF was given an update on the dynamic risk management project and provided feedback on how to perform an outreach on the core version of the DRM model.
• IBOR reform and its effects on financial reporting (17–22): The ASAF was given an update on the IBOR reform project and provided feedback on potential accounting issues to be considered during the project’s Phase II.
• Disclosure initiative — Accounting policy disclosure (23–30):  The ASAF provided preliminary views on Exposure Draft, Disclosure of Accounting Policies.
• Agenda planning and 2020 Agenda Consultation (31–38) — The ASAF discussed the proposed agenda for its December 2019 meeting and the Request for Information for the 2020 Agenda Consultation.
• Accounting policies and accounting estimates (39–43): The ASAF discussed KASB’s research project A Revisit to the Definition of Accounting Estimates.

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

Amendments to IFRS 17 Insurance Contracts: In June 2019 the Board issued ED/2019/4 Amendments to IFRS 17. The staff will summarise the feedback from the comment letters on the ten questions in the ED and summarise comments on areas for which amendments to IFRS 17 were considered but not proposed. The staff set out a recommended plan for redeliberations.

Implementation matters:

• Lack of Exchangeability (IAS 21): In June 2019, the IFRS Interpretations Committee discussed the difficulties in applying IAS 21 when a currency suffers from an extreme long-term lack of exchangeability and when a foreign operation has not been able to access foreign currencies using the available legal exchange mechanisms, such as with the Venezuelan Bolivar. The staff have concluded that this matter is widespread and could have a material effect on those affected and it is necessary to amend IAS 21 to address the matter.  
• Annual Improvements: The Board published ED/2019/2 Annual Improvements to IFRS Standards 2018–2020 in May 2019. The Board will consider the comments received: Subsidiary as a First-time Adopter (Amendment to IFRS 1); Fees Included in the ‘10 per cent’ Test for Derecognition of Financial Liabilities (Amendment to IFRS 9); Lease Incentives (Amendment to Illustrative Examples accompanying IFRS 16); Taxation in Fair Value Measurements (Amendment to IAS 41).
• Cryptoassets: The Board will be given updated information the staff has obtained by monitoring developments on holdings of cryptocurrencies or initial coin offerings.

Primary Financial Statements

During the drafting of the ED to replace parts of IAS 1, the staff concluded that it did not have sufficient guidance from the Board on how gains and losses from disposal or impairment of integral associates and joint ventures should be classified. The staff recommend that they be presented together with the share of profit or loss, and impairment losses and reversal of impairment, from those investments.

IFRS 3 reference to the Conceptual Framework: In May 2019, the Board published ED/2019/3 Reference to the Conceptual Framework, which proposed amendments to IFRS 3. The Board will discuss the comments received. All respondents supported updating the references in IFRS 3, albeit with some disagreement about aspects of the ED. All respondents supported the proposal. No decisions are asked from the Board.

Management Commentary: The Board will discuss what guidance the revised Practice Statement should include relating to an entity’s business model.

Disclosure Initiative: The Board will continue looking at the disclosure requirements in IAS 19 and IFRS 13. In particular it will consider recommendations for changes to those Standards so that some requirements use prescriptive language (shall) and others use less prescriptive language (such as ‘shall consider’ or ‘will normally disclose’).

Subsidiaries that are SMEs: The objective of this project is to consider providing disclosure relief for subsidiaries that are SMEs. The staff recommend that the project proceed based on the original scope (i.e. considering only subsidiaries that are SMEs) but consider later whether the scope can be expanded without significantly affecting the conclusions already reached.

IBOR Reform and the Effects on Financial Reporting: The October papers stated that the staff would bring the hedge accounting issues arising in Phase 2 for discussion with the Board at this meeting. That discussion is not on the November agenda.

More information

Our pre-meeting summaries are available on our November meeting notes page and will be supplemented with our popular meeting notes after the meeting.

The exposure draft addresses the uncertainty in practice about how an entity applies the initial recognition exemption in paragraphs 15 and 24 of IAS 12 Income Taxes to transactions that give rise to both an asset and liability on initial recognition and may result in temporary differences of the same amount.

EFRAG is supportive of the International Accounting Standards Board (IASB)'s aim to reduce diversity in practice in this area. However, it considers that the proposal to add an exception to an existing exemption may introduce added complexity.  EFRAG has concerns with the recognition 'cap' in paragraph 22A(b) for a deferred tax liability, and the consequences of this proposal in subsequent periods.

It also considers that the scope of the ED is broader than leases and decommissioning obligations but that the ED does not address the consequences of this potential wider scope.  EFRAG proposes that the IASB could just limit the scope to lease transactions.  Given the complexity of the proposals EFRAG has also considered whether the gross approach is the better solution rather than the net approach.

A press release and the final comment letter are available on the EFRAG website. 

The recommendations called for action from all stakeholders and importantly included a target of 33% representation of women on FTSE 350 Boards and FTSE 350 leadership teams (comprising the executive committee and the direct reports to the executive committee) by the end of 2020.

The fourth report highlights that “there has been some notable progress made by companies towards meeting the Reviews 33% targets for women in senior leadership positions in the FTSE 350 by the end of 2020”. It also indicates that with in the FTSE 350 there is greater than 30% of women representation on boards predominantly driven by the FTSE 250.

The report highlights that the number of women on FTSE 100 boards is “close to the target” having increased to 32.4% from 30.2% last year. It indicates that “half of all FTSE 100 boards have already met or exceeded the 33% target” but there are still a number of companies with work to do. The report also indicates that the FTSE 250 “has had its best year ever” increasing the number of women on FTSE 250 boards to 29.6% up from 24.9% last year. Just under half of the FTSE 250 have already met or exceed the 33% target but “the significant other half of the FTSE 250 index still have work to do”.

Looking forwards the report predicts that the FTSE 100 is “likely to achieve the 33% target” ahead of the 2020 deadline. Additionally if the FTSE 250 trend continues the report predicts that if “nearly half of all available appointments go to women next year, the FTSE 250 will also meet the target by the end of 2020”.

Turning to change in leadership roles the report flags that the pace of change is slow. The report indicates that a significant “step up in the appointment rate of women” highlighting that unless half of all appointments made this year go to women “the FTSE 350 will miss their target”.

Update 08/02/2020 - the number of FTSE 100 board members that are women is now 33%.  However the government has highlighted a "concerning lack of female representation in senior leadership and key executive roles in FTSE companies".  For the FTSE 250, the number of board members that are women is 29.5%.  The latest press release can be found on the BEIS websire here.

A press release and the full report are avail­able.

We support the efforts of the IASB to address an issue that has been the source of diversity in practice and that is likely to increase as a result of the application of IFRS 16 Leases. Currently, most entities faced with the issue either apply IAS 12 separately to the asset and liability (i.e., no deferred taxes are recognised on initial recognition or subsequently because of the application of the initial recognition exemption (IRE) to the temporary difference on the asset and the liability) or they apply the requirements of IAS 12 to the transaction as a whole (i.e., no deferred taxes are recognised initially because the transaction results in a nil net asset but deferred taxes are recognised subsequently as the carrying amount of the asset and liability diverge). We believe that either of these approaches is acceptable under IAS 12 and that diversity could have been addressed by the Board proposing the method it considered most relevant through an Interpretation of IAS 12.

The accounting treatment resulting from the proposals in the ED is more complex than the methods currently applied by entities. To ensure that the amendments achieve the objective of reducing diversity in practice, further clarification beyond those proposed in the ED will be required. The Board may wish to reconsider whether, in the context of a narrow scope project, it may be preferable to address diversity in practice through an Interpretation (as discussed in BC13 to BC15) and consider whether changes should be made to the IRE as part of a more comprehensive review of the IRE. If the Board pursues modifying the scope of the IRE, we note that important elements of the proposed approach are currently discussed in the Basis for Conclusions. We believe that it is important that these elements be brought into IAS 12 itself. An illustrative example of the proposed approach would also be helpful. Our specific concerns regarding the need for further clarification are presented in the Appendix to this letter.

As further explained in our detailed response, we believe that a key difficulty that needs to be address is the identification of transactions that are indeed subject to the IRE.

We note that the Board proposes transition relief to permit entities on adoption of the proposed amendments to assess the recoverability requirement only at the beginning of the earliest comparative period presented. We suggest that the transition relief be expanded such that entities are permitted to recognise and measure deferred tax amounts based on the temporary differences determined at the beginning of the earliest comparative period presented with the difference recognised in opening retained earnings (or component of equity). This appears appropriate considering that deferred tax assets and liabilities are reassessed and remeasured at each reporting period. We believe that the same transition relief should be offered to first-time adopters for the same reason.

Please click to download our full comment letter here.

Specifically, the Trustees are seeking individuals who are not currently practicing at a Big Four accounting firm. Members are expected to attend ap­prox­i­mately six two-day meetings each year held in London. Terms of mem­ber­ship will begin immediately and will expire on 30 June 2022. Mem­ber­ship is unpaid, but the IFRS Foun­da­tion meets members' expenses of travel on IFRS IC business.

Ap­pli­ca­tions are accepted until 6 December 2019.

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

This remuneration guidance sets out its members’ views on the role of shareholders and directors in relation to remuneration and the manner in which remuneration should be determined and structured.

Updates have been made to reflect current best practice and to reflect the views of the Investment Association’s members in areas such as:

• The impact of remuneration on wider stakeholders.
• The consultation process.
• Approach to leavers.
• Long-term incentives and alignment or performance conditions with the company strategy.

Additionally the IA has issued a letter to Remuneration Committee chairmen highlighting key aspects of the Principles that its members have identified as areas of focus for the forthcoming AGM season. These are:

• Alternative remuneration structures;
• Discretion on vesting outcomes;
• Approach to pensions;
• Shareholding requirements and post-employment shareholding requirements;
• Levels of remuneration; and
• Pay for performance.

The press release, revised Principles of Remuneration and letter to the chairs of Remuneration Committees are available from the IVIS website.

The Board will discuss the following:

• Subsidiaries that are SMEs.
• Disclosure initiative.
• IFRS 3 reference to the Conceptual Framework.
• Management commentary.
• Amendments to IFRS 17 Insurance Contracts.
• Implementation matters — Lack of exchangeability (IAS 21), annual improvements, and cryptoassets.

The full agenda for the meeting can be found here. We will post any updates to the agenda, our com­pre­hen­sive pre-meet­ing summaries as well as observer notes from the meeting on this page as they become available.

These financial statements illustrate the presentation and disclosure requirements of IFRSs for the year ended 31 December 2019 by an entity that is not a first-time adopter of IFRSs. They illustrate the impact of the application of IFRSs that are mandatorily effective for the annual period beginning on 1 January 2019.

The publication includes:

• Consolidated statement of profit or loss and other comprehensive income
• Consolidated statement of financial position
• Consolidated statement of changes in equity
• Consolidated statement of cash flows
• Notes to the consolidated financial statements
• Independent auditor’s report
• Appendix 1 – Prior year adjustment

Please click to download the model financial statements here. The model financial statements illustrate the initial application of IFRS 16 Leases using a full retrospective approach. An appendix illustrating transitioning to IFRS 16 Leases using the cumulative catch-up approach is available here.

In addition, UK IFRS reporters should additionally consider the legal and regulatory requirements which UK IFRS reporters will also need to comply with.

EFRAG published its final comment letter in June 2019.

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 

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