The UKEB secretariat welcomes stakeholders’ views to inform its recommendation to the BEIS Secretary of State to adopt the Amendment in the UK. 

The UKEB secretariat's initial assessment concludes that:

• the Amendment meets the criteria 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 Amendment is 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 UKEB secretariat initially concludes that the Amendment will improve the quality of financial reporting and that the benefits of the Amendments are likely to outweigh the costs.

Comments on the draft UK Endorsement Criteria Assessment are requested by 5 May 2021. 

For more information, see the press release, Invitation to Comment and draft UK Endorsement Criteria Assessment on the UKEB's website. 

During the meeting, the IASB will discuss the following:

• Goodwill
• Primary financial statements
• Maintenance and consistent application
• Dynamic risk management
• Financial instruments with characteristics of equity

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.

Apart from the Chair's welcome and preview and an address by the IASB Chair Hans Hoogervorst, the only topic of discussion will be the recently launched third agenda consultation.

Agenda papers for the meeting will be made available on the IASB website.

The topics for discussion are:

• Post Implementation Review of IFRS 10,11 and 12 - draft response for comment
• IASB Agenda consultation - education session and initial views 

The meeting, agenda papers and details of how to register are available on the UKEB website.
 
The meeting recording can be found on the UKEB website here.

The IFRS Advisory Council provides a forum for the IASB to consult a wide range of interested parties affected by the IASB's work, with the objective of advising the Board on agenda decisions and priorities in the Board's work, informing the Board of the views of the organisations and individuals on the Council on major standard-setting projects, and giving other advice to the Board or to the Trustees.

For more information, please see the press releases on the IASB website:

• Advisory Council members
• Advisory Council Chair

IASB members are appointed for an initial five-year term with the pos­si­bil­ity of being reap­pointed for another three years (in ex­cep­tional cir­cum­stances for another five years). Nom­i­na­tions for IASB Board mem­ber­ship close on 30 June 2021.

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

Comments on tentative agenda decisions

IAS 19 Employee Benefits—Attributing Benefit to Periods of Service: In December 2020, the Committee discussed the periods of service an entity attributes the benefit for a defined benefit plan when the amount of the retirement benefit to which an employee is entitled depends on the length of services before retirement. The Committee concluded that the entity attributes the period of service to only the last 16 years of employee services. A number of respondents commented that the Committee should not rule out the possibility of attributing the obligation from the date of employment applying the overarching objective in IAS 19:1.

The staff continue to support their view through analysis of these comments and conclude that the agenda decision should be finalised with some changes.

IAS 1 Presentation of Financial Statements—Classification of Debt with Covenants as Current or Non-current: In December 2020, the Committee discussed the informal feedback and enquiries received concerning the different interpretations arising from the application of recent amendments to IAS 1 related to the classification of liabilities. In the meeting, the Committee members generally agreed with the analysis of how an entity determines whether it has "the right to defer settlement" when a long-term liability is subject to a condition and its compliance with the condition is tested at dates after the reporting date, applying the amended IAS 1, in the three cases described. However, almost all of the respondents expressed concerns about the outcome of applying the IAS 1 amendments and suggested the matter be referred to the Board.

The staff recommend reporting the matter to the Board but at the same time, asks whether the Committee wishes to finalise the agenda decision in view of the fact that that the principles and requirements in IFRS Standards provide an adequate basis for the conclusion reached in the three cases described in the fact pattern.

IFRS 9 Financial Instruments—Hedging Variability in Cash Flows due to Real Interest Rates: In December 2020, the Committee discussed whether a hedge of the variability in cash flows arising from the changes in the real interest rate could rebut the presumption in IFRS 9:B6.3.13 and be accounted for as a cash flow hedge. The Committee members generally agreed with the staff's conclusion that hedge accounting cannot be applied to the inflation swap in the fact pattern described. Half of the respondents to the tentative agenda decision did not agree with the discussion explaining that cash flow hedge accounting could not be applied. The staff analysed the reasons for the disagreement and continue to support the conclusion in the agenda decision. The staff recommend the agenda decision be finalised.

Work in progress: The staff are analysing requests related to the accounting for power purchase agreements in a gross pool electricity market.

The full agenda for the meeting and our com­pre­hen­sive pre-meet­ing summaries can be found here.

More in­for­ma­tion about the issues is set out below:

Click to access all our comment letters to the IASB, IFRS Foun­da­tion, and IFRS In­ter­pre­ta­tions Committee.

Mr Perrin has extensive experience as a preparer and has worked closely with the Board and the Foundation for several years, most recently as a member of the IFRS Interpretations Committee. He is currently also serving as a member of the EFRAG’s Advisory Panel on Intangibles and is the Director of Accounting Standards and Special Projects at Vivendi. Mr Perrin will fill the European seat, succeeding Françoise Flores, whose term will end at the end of June.

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

The proposed new standard is intended to replace IFRS 14 Regulatory Deferral Accounts.

In its draft comment letter EFRAG

• generally agrees with the IASB proposals and considers that the benefits would outweigh the costs for both users and preparers;
• is seeking views of constituents on possible unintended consequences on the impact of the scope outside the utilities sector;
• supports the three proposed components of the total allowed compensation except for the treatment of construction work in progress;
• disagrees with the proposed application of a minimum adequate rate as the discount rate for regulatory assets, when the regulatory interest rate provided is insufficient;
• considers that the level of detail required to meet the specific disclosure objectives might impose a significant burden on reporting entities to generate the information; and
• Questions the proposed amendments to IFRS 1 and IFRS 3.

Comments on EFRAG's draft comment letter are requested by 28 July 2021. For more information, see the press release and the draft comment letter on the EFRAG's website.