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August

Additional update to the IASB work plan — Analysis

28 Aug 2020

The IASB has once more updated its work plan. We have analysed the changes that have resulted since it was last revised on 11 August 2020. Among other things, all changes that were made in mid-August have been reversed.

Below is an analysis of all changes made to the work plan since our last analysis on 11 August 2020.

Standard-setting projects

  • No changes

Maintenance projects

  • 2019 Comprehensive review of the IFRS for SMEs — discussion of the feedback on the request for information is now expected in the fourth quarter of 2020 (previously no date given)
  • IBOR reform and its effects on financial reporting — Phase 2 — this project has been removed from the work plan since the IASB issued final amendments yesterday
  • Lease Liability in a Sale and Leaseback — the issuance of an exposure draft is now expected in the fourth quarter of 2020 (previously September 2020)

Research projects

  • Business Combinations under Common Control — a discussion paper is now expected in the fourth quarter of 2020 (previously September 2020)
  • Dynamic Risk Management — Core model outreach is now expected in the fourth quarter of 2020 (previously October 2020)
  • Post-implementation Review of IFRS 10, IFRS 11 and IFRS 12 — the request for information is now expected in the fourth quarter of 2020 (previously October 2020)

Other projects

  • Due Process Handbook Review — this project has been removed from the work plan since the IFRS Foundation published the revised handbook on 21 August 2020
  • IFRS Taxonomy Update — Common Practice (IAS 19 Employee Benefits) — a proposed IFRS Taxonomy Update is now expected in November 2020 (previously October 2020)
  • IFRS Taxonomy Update — COVID-19 Related Rent Concessions (Amendments to IFRS 16) — this project has been removed from the work plan since the IFRS Foundation published the final Taxonomy Update on 18 August 2020
  • IFRS Taxonomy Update — Interest Rate Benchmark Reform — Phase 2 — a proposed IFRS Taxonomy Update was published yesterday and feedback on the proposed update is expected to be discussed in October 2020

The above is a faithful comparison of the IASB work plan at 11 August 2020 and 28 August 2020. For access to the current IASB work plan at any time, please click here.

BIS calls IFRS 17 a "welcome development"

03 Aug 2020

The Financial Stability Institute (FSI) of the Bank for International Settlements (BIS) has published a paper 'Accounting standards and insurer solvency assessment' dealing with IFRS 17 'Insurance Contracts'.

Most of the 20 jurisdictions surveyed for the paper expressed the belief that IFRS 17 will contribute to financial stability through greater transparency as the current international accounting standards for insurance contracts permit a variety of approaches, which complicate comparison between insurers’ financial results. The paper states:

Overall, IFRS 17 is a welcome development. It is aimed at improving global comparability with respect to the structure of liability valuation and transparency in insurer balance sheets, thus benefiting policyholders, investors and, ultimately, financial stability.

Please click to access the paper on the BIS website.

Consultation paper on a new ESG disclosure standard

20 Aug 2020

The CFA Institute, a global association of investment professionals, is developing a voluntary, global industry standard to provide greater product transparency and comparability for investors by enabling asset managers to clearly communicate the ESG-related features of their investment products.

In that context the CFA Institute published a consultation paper that defines ESG-related features as components or capabilities of investment products that can be combined in different ways to meet different investor needs. It identifies the following six ESG-related features:

  • ESG integration;
  • ESG-related exclusions;
  • Best-in-class;
  • ESG-related thematic focus;
  • Impact objective; and
  • Proxy voting, engagement and stewardship.

The features are expected to serve as a backbone of the standard in that they are a mechanism to connect investor needs and disclosure requirements.

The CFA Institute seeks input on the consultation paper from the wider investment community to help shape an exposure draft, which is expected to be released in May 2021.

Responses on the consultation paper are requested by 19 October 2020. The paper, a response form for providing comments, and volunteer opportunities in connection with developing the new standard are available on the CFA Institute website.

 

EFRAG outreach event in the context of the endorsement process of IBOR Phase 2

03 Aug 2020

The issuance of final amendments as result of the IASB project on 'IBOR reform and the effects on financial reporting — Phase 2' is expected in August. Given the urgency of the endorsement and the accelerated consultation process, the European Financial Reporting Advisory Group (EFRAG) has organised a public outreach event on 7 September 2020 to collect additional views from constituents on the draft endorsement advice EFRAG plans to publish at the end of August (shortly after the publication of the amendments by the IASB).

Please click for more information and registration for the event on the EFRAG website.

EFRAG publishes July 2020 issue of 'EFRAG Update'

04 Aug 2020

The European Financial Reporting Advisory Group (EFRAG) has published an 'EFRAG Update' summarising public technical discussions held and decisions made during July 2020.

The update reports on the EFRAG Board conference call on 6 July and webcast meeting on 16 July, the EFRAG TEG webcast meeting on 1-2 July, 8 July and a conference call on 6 July and the EFRAG TEG and EFRAG CFSS webcast meeting on 1 July.  The publication also covers the activities of the European Reporting Lab.

The update also lists EFRAG publications issued in July including:

Please click to download the July EFRAG Update from the EFRAG website.

FRC and IASB release joint webinar on General Presentation and Disclosures Exposure Draft

27 Aug 2020

The joint webinar held by the Financial Reporting Council (FRC) with the International Accounting Standards Board (IASB) on the General Presentation and Disclosures Exposure Draft (ED/2019/7) has been released.

The FRC has published a recording of the joint webinar with the IASB on the General Presentation and Disclosures Exposure Draft, which was held on 6 August 2020. The comment period closes on 4 September 2020 and the FRC's draft comment letter can be found here.

Further information can be found here and the webinar is available here.

 

 

 

 

FRC issues statement on application of Accounting for Lease Modifications (Amendment to IFRS 16 - Covid-19-Related Rent Concessions)

24 Aug 2020

The Financial Reporting Council (FRC) has confirmed it will not pursue regulatory action in the Accounting for Lease Modifications (Amendment to IFRS 16 – Covid-19-Related Rent Concessions) before adoption by the EU.

In May 2020, the International Accounting Standards Board (IASB) published 'Covid-19-Related Rent Concessions (Amendment to IFRS 16)' which provides practical reliefs for preparers accounting for Covid-19-related rent concessions.

This amendment is effective for annual reporting periods beginning on or after 1 June 2020, but may also be applied early; however, the amendment is still subject to EU endorsement, which is expected to complete during Autumn 2020, and EU law is still applicable in the United Kingdom during the transition period following EU exit.   

Both the European Securities and Markets Authority (ESMA) (per statement on 21 July 2020) and the Financial Conduct Authority (FCA) (per statement on 18 August 2020) have also confirmed that they will not ‘prioritise supervision action’ relating to issuers’ decisions on whether or not to apply the reliefs that the amendment provides for, noting that where issuers’ use the reliefs, they will diverge from IFRS 16 as currently endorsed by the EU.

The FRC will similarly not pursue regulatory action against companies taking advantage of the reliefs permitted by the amendment.  The reliefs apply for both annual and interim accounts. If companies use the reliefs permitted by the IFRS 16 amendment, they are expected to disclose this in the notes to their financial statements. 

The FRC reminds directors of the need to ensure that the impact of applying this amendment, prior to EU adoption, on the lawfulness of any distributions is carefully considered. It also expects auditors to comply with all their obligations, for example, any requirement to report under s837 of the Companies Act 2006.

Click here for the press release on the FRC website.

HM Treasury publishes 2020/2021 sustainability reporting guidance for public sector annual reports

24 Aug 2020

HM Treasury has published guidance to assist those in the public sector in meeting sustainability reporting requirements for 2020/2021.

The guidance sets out the minimum requirements that must be met, provides some best practice examples and also indicates the underlying principles that should be adopted in preparing the information for reporting on sustainability within the annual reports and accounts.

The guidance is applicable to all central government bodies that fall within the scope of the Greening Government Commitments (i.e. departments, non-ministerial departments, agencies and non-departmental public bodies) and which produce annual reports and accounts in accordance with HM Treasury's Government Financial Reporting Manual (FReM). These bodies are required to report on sustainability (unless exempt from doing so).

The press release and guidance are available on HM Treasury website.

IASB announces fourth webinar on PFS ED

07 Aug 2020

In December 2019, the IASB published the exposure draft of a new standard 'General Presentation and Disclosures' that is intended to replace IAS 1 'Presentation of Financial Statements'. The IASB is introducing the exposure draft in a series of webinars.

The fourth and final webinar in this series will be held on 21 August 2020. It will explain the Board’s detailed proposals for management performance measures. The webinar will last approximately 60 minutes and will include a question-and-answer session. More information is available here.

IASB announces webinar on the second comprehensive review of the IFRS for SMEs Standard

03 Aug 2020

The IASB will be holding two repeated live webinars on 17 August 2020 (09:00 and 15:00 (BST)) to discuss the second comprehensive review of the IFRS for SMEs Standard.

The webinars will be hosted by IASB Board Member Darrel Scott and the IASB’s technical staff. Participates are allowed to submit question prior to the webinars.

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

Correction list for hyphenation

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