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FRC invites comments on its draft UK Endorsement Criteria Assessment on the Amendments to IFRS 4 - extension to IFRS 9 deferral

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27 Oct 2020

The Financial Reporting Council (FRC) has published a draft UK Endorsement Criteria Assessment on the International Accounting Standards Board's (IASB’s) 'Amendments to IFRS 4 - Extension of the Temporary Exemption from Applying IFRS 9' (the Amendments).

As part of the preparation for the end of the Transition Period, work is being undertaken to ensure the UK is ready to undertake adoption of the Amendments if EU adoption does not occur in December 2020 (as the UK leaves the EU at the end of the transition period on 31 December 2020).

The FRC welcomes stakeholders’ views to inform its recommendation to the BEIS Secretary of State to adopt the Amendments in the UK.

The FRCs initial assessment is that:

  • the Amendments meet the criterion of relevance, reliability, comparability and understandability required of the financial information needed for making economic decisions and assessing the stewardship of management, as required by SI 2019/685 (see Regulation 7(1)(c)); and
  • application of the Amendments are not contrary to the principle that an entity’s accounts/consolidated accounts must give a true and fair view as required by SI 2019/685 (see Regulation 7(1)(a)).

Additionally the FRC initially concludes that the Amendments will improve the quality of financial reporting, that the benefits of the Amendments are likely to outweigh the costs and that users are likely to benefit from the Amendments.

The press release, Invitation to Comment and the draft UK Endorsement Criteria Assessment are available on the FRC website.

Comments are requested by close of business on Tuesday 10 November 2020. 

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