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January

PRAG publishes guidance on TCFD disclosures for occupational pension schemes

13 Jan 2022

The Pensions Research Accountants Group (PRAG) has published guidance to help practitioners understand the Taskforce on Climate-related Financial Disclosures (“TCFD”) governance and reporting requirements that have been introduced for certain pension schemes from 1 October 2021.

The new requirements do not affect financial reporting disclosures but do have an impact on the information included in, and linked from, the annual report of occupational pension schemes.

Click for the press release on the PRAG website. The guidance is available to PRAG members on its website.

Agenda for the upcoming SMEIG meeting

12 Jan 2022

The next meeting of the SME Implementation Group (SMEIG) will be held on 21 January 2022 via video conference.

The SMEIG will discuss the following topics:

  • Definition of a business and reacquired rights in IFRS 3 Business Combinations
  • Simplifications to IFRS 15 Revenue from Contracts with Customers
  • Cryptocurrency
  • Recognition and measurement of development costs
  • Update on recent IASB decisions on the project to review the IFRS for SMEs

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

CMAC seeks members

11 Jan 2022

The Capital Markets Advisory Committee (CMAC) is seeking new members and welcomes applications from analysts and investors from all over the world.

New members will start on 1 January 2023 for a term of three years, renewable once for a further three years. For more information, please see the press release on the IASB website.

Podcast on IFRS Interpretations Committee developments

10 Jan 2022

The IASB has issued a podcast on the developments of the IFRS Interpretations Committee during the fourth quarter of 2021.

The podcast is hosted by IFRS Interpretations Committee Chair and IASB Vice-Chair Sue Lloyd and Technical Staff member Patrina Buchanan and focuses on economic benefits from use of a windfarm (IFRS 16), principal versus agent — software reseller (IFRS 15), negative low emission vehicle credits (IAS 37), and lease liability in a sale and leaseback (IFRS 16) .

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

IFRS Foundation seeks ISSB Board members

10 Jan 2022

The IFRS Foundation Trustees are seeking to appoint up to eleven inaugural Board members for the newly formed International Sustainability Standards Board (ISSB).

Members of the ISSB will be appointed for an initial term of up to five years with the possibility of being reappointed for another three years (in exceptional circumstances for another five years). The roles are full-time, although a number of part-time members may be appointed. Members of the ISSB are expected to be based in one of the ISSB’s global offices and will be required to travel internationally to meet with fellow board members and staff, as well as stakeholders.

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

Hyperinflationary economies - updated IPTF watch list available

10 Jan 2022

IAS 29 'Financial Reporting in Hyperinflationary Economies' defines and provides general guidance for assessing whether a particular jurisdiction's economy is hyperinflationary. But the IASB does not identify specific jurisdictions. The International Practices Task Force (IPTF) of the Centre for Audit Quality (CAQ) monitors the status of 'highly inflationary' countries. While it monitors the status of highly inflationary countries for the purposes of applying US GAAP, its criteria for identifying such countries are similar to those for identifying 'hyperinflationary economies' under IAS 29.

The IPTF's discussion document for the 6 November 2021 meeting is now available and states the following view of the Task Force:

Countries with three-year cumulative inflation rates exceeding 100%:

  • Argentina
  • Iran
  • Lebanon
  • South Sudan
  • Sudan
  • Venezuela
  • Zimbabwe

Countries with projected three-year cumulative inflation rates exceeding 100%:

  • Suriname
  • Yemen

Countries where the three-year cumulative inflation rates had exceeded 100% in recent years:

There are no countries in this category for this period.

Countries with recent three-year cumulative inflation rates exceeding 100% after a spike in inflation in a discrete period:

There are no countries in this category for this period.

Countries with projected three-year cumulative inflation rates between 70% and 100% or with a significant (25% or more) increase in inflation during the current period

  • Angola
  • Haiti

The IPTF also notes that there may be additional countries with three-year cumulative inflation rates exceeding 100% or that should be monitored which are not included in the analysis as the necessary data is not available. Examples cited are Afghanistan, Ethiopia, and Syria.

The full list, including exact numbers, detailed explanations of the calculation of the numbers, and observations of the Task Force is available on the CAQ website.

IFRS Foundation Trustees hold December 2021 meeting

07 Jan 2022

The IFRS Foundation Trustees met by video conference on 13 December 2021.

Meeting ac­tiv­i­ties included the following:

  • ISSB leadership nominations — The Trustees reviewed the report from the Nominating Committee for appointments to the International Sustainability Standards Board (ISSB). Appointments to the ISSB are expected to be completed in January 2022.
  • Asia-Oceania office — The Trustees will be asked to approve the retention of its office in Tokyo for the next five year.
  • Departing Trustees — The Chair acknowledged the service of departing members Guillermo Babatz and Kazuyuiki Masu.

The meeting summary also includes strategic considerations for the ISSB as it begins its work.

For more in­for­ma­tion, see the full summary on the IFRS Foun­da­tion Trustees’ meeting on the IASB’s website.

EFRAG publishes December 2021 issue of EFRAG Update

07 Jan 2022

The European Financial Reporting Advisory Group (EFRAG) has published an ‘EFRAG Update’ summarising public technical discussions held and decisions made during December 2021.

Deloitte comments on IASB’s proposed disclosure requirements in IFRS Standards

06 Jan 2022

We have commented on the IASB's exposure draft ED/2021/3 'Disclosure Requirements in IFRS Standards — A Pilot Approach' published in March 2021.

The ED contains proposed guidance for itself when developing and drafting disclosure requirements in IFRSs in future as well as proposed amendments to IFRS 13 'Fair Value Measurement' and IAS 19 'Employee Benefits' that result from applying the proposed guidance to those standards.

We support the efforts of the Board to improve disclosures and to address the disclosure problem. We agree that the inclusion of disclosure objectives and a description of users’ needs are helpful to enhance the use of judgement in the preparation of financial statements. However, we do not agree with the removal of prescriptive disclosure requirements and we share the concerns laid out in the alternative view on enforceability of the approach in practice. Further, we note in the ‘Future effects’ section that the Board will decide through the normal process whether to amend the disclosure section of IFRS Standards already in issue to reflect the proposals in the ED. We would not support such a decision if the amendments were developed as proposed in the ED.

In addition, we support the proposal to include a paragraph for each specific objective on why the information is needed by users, however, we note that for some examples provided in respect of IFRS 13 and IAS 19 the needs of users could be explained more clearly. In terms of the proposals in the ED, we strongly believe that the Board should avoid using the term ‘non-mandatory’ to describe disclosures that entities are expected to include to meet the overall and specific objectives, as the term ‘non-mandatory’ may be inappropriately understood to mean optional.

Please click to download our full comment letter.

AAOIFI issues three new financial accounting standards

02 Jan 2022

The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) has issued financial accounting standard (FAS) 1 (Revised 2021) 'General Presentation and Disclosures in the Financial Statements', FAS 39 'Financial Reporting for Zakah', and FAS 40 'Financial Reporting for Islamic Finance Windows'.

The revised FAS 1 supersedes the earlier FAS 1 General Presentation and Disclosures in the Financial Statements of Islamic Banks and Financial Institutions and introduces the concepts of quasi-equity, off-balance-sheet assets under management and other comprehensive income to enhance the information provided to the users of the financial statements.

FAS 39 improves upon and supersedes FAS 9 Zakah and aims at setting out the accounting treatment of Zakah in the books of the institutions, including the presentation and disclosure by an Islamic financial institution.

The objective of FAS 40 is to establish financial reporting requirements for Islamic finance windows and is applicable to all conventional financial institutions providing Islamic financial services through an Islamic finance window. The standard improves upon and supersedes FAS 18 Islamic Financial Services Offered by Conventional Financial Institutions.

More information on the standards is available through the press releases on the AAOIFI website:

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