Overall the UKEB supports the proposals in the Exposure Draft.  It does, however, make a number of recommendations to enhance the proposals including that:

• The proposed standard should be explicit that the agreements intended to be included in the scope of the definition “regulatory agreement” are a small subset of regulatory agreements. 
• The proposed standard should explicitly exclude service concession arrangements from its scope unless there is clear evidence that users would gain additional information from the application of both IFRIC 12 and the proposed standard to such agreements.
• The proposed standard should require an entity's regulator to be an independent third-party.
• Regulatory returns relating to assets not yet available for use in Total Allowable Compensation (TAC) should follow the economic substance of the requirements in the regulatory agreements.

The final comment letter is available on the UKEB website.

Exposure Draft 80 Improvements to IPSAS, 2021 proposes changes based off feedback received from stakeholders and publications by the IASB. Comments are requested by 30 September 2021.

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

In the draft comment letter, EFRAG expresses its appreciation for the IASB’s swift response and delivery of the exposure draft. Also, EFRAG commends the IASB for addressing most of the comments raised by European constituents in this area. Overall, EFRAG agrees with the IASB proposals in the exposure draft as they form a clear improvement over the current situation.

Comments on EFRAG's draft comment letter are requested by 15 September 2021. For more information, see the press release and the draft comment letter on the EFRAG website.

The feedback statement follows the discussion paper A Matter of Principles: The Future of Corporate Reporting, published in October 2020. In the feedback statement, the FRC discusses the feedback received from respondents and the next steps it plans to take, after taking into consideration the feedback received, over the short, medium and long term.

Feedback from respondents was broadly supportive of a reporting model that accommodates the information needs of investors and wider stakeholders; the development of guiding principles; the concept of the reporting network; and the development of standards for non-financial reporting. There was also support for the importance of firms providing information about how they view their obligations in respect of the public interest although support was more muted for a standalone Public Interest Report.

Respondents also called for the FRC to consider the practical challenges of implementing the proposals, including the level of audit and assurance over the different reports within the network.

The FRC received mixed views on whether an objective-driven model that was audience-neutral should replace the current model where the content of the report is determined by reference to the information needs of the primary users. One of the challenges identified with the objective-driven approach was determining materiality.

The press release and full feedback statement are available on the FRC website.

The report reveals that the FRC’s Enforcement Division has grown by 44% in the last year, to enable the swifter resolution of cases, while the number of investigations opened also increased.  Further growth is planned for the year ahead. 

The report highlights the FRC’s continued focus on driving audit quality improvements, with a significant number of cases resolved through constructive engagement. In matters which have been subject to enforcement action, 28 non-financial sanctions have resulted, including a number of requirements and conditions. These have included requirements for audit firms to undertake root cause analysis to ensure the underlying reasons for any failures are swiftly addressed and for training programmes to be implemented in areas of identified weakness.

Last year to assist in driving audit quality the report included themes from past audit cases. This year, with a view to improving the quality of financial statements by demonstrating behaviours to be avoided, the report includes themes from past cases against those responsible for preparing
financial statements.  It also highlight challenges for accountants and auditors in addressing future uncertainties arising from EU Exit, climate change and the pandemic.

The press release and Annual Enforcement Review are available from the FRC website. 

The update reports on the EFRAG Board webcast meeting on 7 July and the EFRAG TEG webcast meeting on 14 -15 July. The update also covers the activities of the European Reporting Lab as well as webinars and online outreaches.

The update also lists EFRAG publications issued in July including:

• EFRAG's final endorsement advice letter on Definition of Accounting Estimates (Amendments to IAS 8);
• EFRAG's final endorsement advice letter on Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2);
• EFRAG's draft endorsement advice letter and separate invitation to comment on Deferred Tax related to Assets and Liabilities arising from a single transaction (Amendments to IAS 12);
• EFRAG's  draft comment letter in response to the IFRS PRactice Statement Exposure DRaft ED/2021/6 Management Commentary.

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

In view of the resources likely to become available, the IPSASB proposes adding two major projects:

• Presentation of Financial Statements; and 
• Differential Reporting.

In addition, the IPSASB proposes to add up to four smaller scope projects:

• IPSAS 21, Impairment of Non-Cash-Generating Assets; 
• IPSAS 31, Intangible Assets; 
• IPSAS 33, First-Time Adoption of Accrual Basis IPSASs; and 
• Making Materiality Judgements.

Comments on the consultation are requested by 30 November 2021. Please click for access to the consultation document, an At a Glance introduction and explanatory videos on the IPSASB website.

The updates include a new chapter on inventory as part of the intangible asset standards, technical revisions consulted on throughout 2020 and 2021 as well as updates to the introduction, the glossary, the IVS Framework, IVS 104, IVS 105, IVS 200, and IVS 400.

More information is available through the press release on the IVSC website.