Mr Schérer will replace Isabelle Grauer-Gaynor, who is stepping down from EFRAG TEG as of 13 September.

For more information, see the press release on the EFRAG's website.

Part of the consultation was a questionnaire intended to support ESMA’s analysis of potential sources of undue short-termism with an aim to identifying areas in which existing rules may contribute to mitigating undue short-termism and areas where the rules may exacerbate short-term pressures.

Section IV of the questionnaire "The role of fair value in better investment decision-making" contained questions on whether and how fair value may impact the capacity of financial reporting to provide relevant and reliable information on equity instruments held for long-term investment purposes. With these questions ESMA wanted to assess how the measurement and disclosure of fair value may impact the selection of a short-or long-term horizon.

Please click to access the press release, which offers access to the responses to the questionnaire, on the ESMA website.

The annual report outlines the FRC’s financial position, highlights achievements and challenges in 2018/19, looks forward to 2019/20 and also sets out progress made to date on its transition to the new Audit, Reporting and Governance Authority (ARGA), following the independent review carried out by Sir John Kingman. 

In 2019/20 the priorities of the FRC will include:

• working with the government to ensure that an effective regulatory framework exists following the UK's exit from the EU;
• driving continued improvements in audit quality by focusing, alongside audit inspections, on the audit improvement programmes put in place by firms and continuing development of auditing and ethical standards;
• promoting corporate governance and investor stewardship including extending the monitoring of practice and reporting on corporate governance and updating the UK Stewardship Code;
• monitoring and taking action to promote audit quality and usefulness of corporate reporting including increasing the planned number of corporate reporting reviews;
• expanding the Enforcement team to provide timely and effective enforcement action to encourage improvements in the quality of audit and financial reporting; and
• supporting transition to the ARGA, including investing in staff, IT and other relevant systems.

The press release and the full annual report are available on the FRC website.

A summary of the agenda is set out below:

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

New Issues

The Committee will discuss three new issues.

IFRS 15 Revenue from Contracts with Customers—Training costs to fulfil a contract (Agenda Paper 2). Should training costs that are incurred by a supplier, that are necessary to be able to deliver a service to a customer and that are recoverable from the customer, be recognised as a contract asset?

IFRS 16 Leases—Definition of a lease—Shipping contract (Agenda Paper 3). Does a particular type of shipping contract contain a lease? 

IAS 21 The Effects of Changes in Foreign Exchange Rates and IAS 29 Financial Reporting in Hyperinflationary Economies—Translation of a hyperinflationary foreign operation (Agenda Paper 4) How does an entity, with a non-hyperinflationary presentation currency, present the information required by IAS 21 and IAS 29 for its interest in a foreign operation which is hyperinflationary?

The staff are recommending that the Committee not develop any Interpretations or amendments but instead publish tentative agenda decisions. 

Agenda decisions to finalise

The staff are recommending that the Committee finalise six tentative agenda decisions.

IFRS 15 Revenue from Contracts with Customers—Compensation for delays or cancellations (Agenda Paper 5). Should an obligation to compensate customers for delayed or cancelled flights (as set out in legislation) be recognised as part of the transaction price or as an obligation in accordance with IAS 37?

IAS 41 Agriculture—Subsequent expenditure (Agenda Paper 6). Should an entity capitalise or expense the costs related to the biological transformation of biological assets?

IAS 7 Statement of Cash Flows—Changes in liabilities arising from financing activities (Agenda Paper 7). Some investors have expressed concerns about the quality and consistency of disclosures about changes in liabilities arising from financing activities required by IAS 7.

IFRS 16 Leases—Incremental borrowing rate (Agenda Paper 8). Does the incremental borrowing rate need to reflect the interest rate in a loan with both a similar maturity to the lease and a similar payment profile to the lease payments?

IFRS 9 Financial Instruments—Fair value hedge of foreign currency risk on non-financial assets (Agenda Paper 9). Can foreign currency risk be a separately identifiable and reliably measurable risk component of a non-financial asset held for consumption (for example, property, plant and equipment and inventory denominated in a foreign currency) that an entity can designate as the hedged item in a fair value hedge accounting relationship?

IAS 1 Presentation of Financial Statements—Presentation of liabilities or assets related to an uncertain tax position (Agenda Paper 10). Should an entity present a liability related to uncertain tax treatments as a current (or deferred) tax liability or as a provision?

Work in progress (Agenda Paper 11)

There are no new matters that have not yet been presented to the Committee. The staff will present the analysis of comments of the tentative agenda decision 'Lease Term and Useful Life of Leasehold Improvements (IFRS 16 Leases and IAS 16 Property, Plant and Equipment)' at a future meeting.

The full agenda for the meeting can be found here. We will update this page for any changes to the agenda and our Deloitte pre-meeting summaries for the meeting as they become available.

The first article Is Goodwill a Wasting Asset? can be accessed through the press release on the IVSC website.

The study assessed the accounts of 296 charities against a new external scrutiny benchmark developed by the Charity Commission to determine whether a minimum standard of scrutiny by auditors and independent examiners had been met. The benchmark is based on the requirements of the Charities Act 2011, the Charities Statement of Recommended Practice (SORP), auditing standards and the Commission’s Directions for independent examiners.

Only three quarters of charities with income over £1 million met the external scrutiny benchmark. This fell to 51% in the case of charities with income of £250,000 - £1 million and just 37% for charities with income below £250,000. Particular issues included incomplete reporting of related party transactions (for which a separate report discussing the findings in more detailed is linked below) and charitable companies failing to provide a separate summary income and expenditure account, or not stating that it was included in the Statement of Financial Activities. The Charity Commission also noted that accounts reviewed by an auditor met the benchmark more frequently than those reviewed by an independent examiner.

As a result of its findings the Charity Commission has issued updated guidance for trustees on independent examination (CC31). It has also made the external scrutiny benchmark available on its website.

Click for (all links to the Charity Commission website):

• the study on external scrutiny;
• the external scrutiny benchmark;
• the report on the findings regarding related party transactions; and
• the updated guidance for trustees on independent examination.

EFRAG is seeking to engage with subject matter experts and practitioners to discuss the following:

• Issuance via initial coin offerings and similar offerings;
• Holding/investing activities and payment services;
• Custodial and storage services; and
• Mining services.

The outreach will be conducted through phone interviews and the questions will be shared before the interview.

Please click for more information on the EFRAG website.

The newsletter provides an update of the Lab's three current projects and a brief overview of its other activities:

• Climate change and workforce reporting;
• Sources and Uses of Cash; and
• Digital Future. 

The full newsletter is available on the FRC website here.

Specifically, this issue features insight into the proposed amendments related to commission paid on short-term insurance contracts with expected renewals and profit recognition on long-term insurance contracts with investment returns.

For more in­for­ma­tion, see the press release and Investor Per­spec­tives article on the IASB’s website.