UK Endorsement Board adopts IFRS 17

17 May 2022

The UK Endorsement Board (UKEB) has approved the adoption of International Financial Reporting Standard (IFRS 17) 'Insurance Contracts' for use by UK companies.

The adoption covers both IFRS 17 issued by the International Accounting Standards Board (IASB) in May 2017, and subsequent amendments in June 2020 and December 2021.

The UKEB secretariat's Endorsement Criteria Assessment concludes that:

  • IFRS 17 meets the criteria of understandability, relevance, reliability and comparability 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 IFRS 17 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 concludes that IFRS 17 is likely to be conducive to the long-term public good in the UK.

The effective date of UK-adopted IFRS 17 is 1 January 2023 with early application permitted for entities that apply IFRS 9 Financial Instruments on or before the initial application of IFRS 17.

The UKEB will carry out a review of the impact of the adoption of the standard and a report setting out the conclusions of this review will be published by the UKEB by 1 January 2028.

For more information, including the Endorsement Criteria Assessment see the UKEB website here.  A link to an updated adoption status report is also available on the UKEB website.

ESMA disclosures recommendations regarding the expected impacts of IFRS 17 application

16 May 2022

The European Securities and Markets Authority (ESMA) has issued a public statement on 'Transparency on implementation of IFRS 17 'Insurance Contracts''.

The statement highlights the importance of issuers accompanying users of their financial statements, so that they understand the expected accounting implications of the new standard’s application.

ESMA’s recommendations cover the disclosures of expected impacts of the initial application of IFRS 17 in the interim and annual financial statements for 2022.

Where the impact is expected to be significant, ESMA expects issuers to:

  • provide information about the significant accounting policy choices to be taken upon initial application of IFRS 17 such as methods to calculate the discount rate, how the level of aggregation requirements will be applied;
  • disaggregate the expected impact in a way that is useful to users of financial statements; and
  • explain the nature of the impacts (on recognition, measurement and presentation) so that users of the financial statements can understand the changes and their key drivers when compared to the accounting principles on classification applied under IFRS 4.

ESMA also encourages issuers to explain the impact, if any, of the application of IFRS 17 on alternative performance measures that the issuer may use.

Please click to access the full statement on the ESMA website.

ESMA statement on the implications of Russia’s invasion of Ukraine

16 May 2022

The European Securities and Markets Authority (ESMA) has released a public statement on the implications of Russia’s invasion of Ukraine on half-yearly financial reports.

The statement notes the significant challenges to business activities and effects on the global economic and financial system posed by the invasion and provides overarching messages to issuers and auditors including:

  • A reminder of the main IFRS requirements which may be applicable in the context of Russia’s invasion of Ukraine e.g., impairment of non-financial and financial assets, and loss of control;
  • ESMA’s expectations regarding disclosures in financial statements e.g., judgements made, significant uncertainties, and going concern risks;
  • ESMA’s expectations regarding disclosures in interim management reports e.g., direct and indirect impact of Russia’s invasion of Ukraine and imposed sanctions on issuers’ strategic orientation and targets, operations, financial performance, financial position and cash-flows, measures taken to mitigate the impacts, and cybersecurity risks; and
  • A reminder of issuers' obligations vis-à-vis the Market Abuse Regulation.

Please click to access the statement on the ESMA website.

May 2022 IASB meeting agenda posted

13 May 2022

The IASB has posted the agenda for its next meeting, which will be held via video conference on 23–27 May 2022. There are ten topics on the agenda.

The Board will discuss the following:

  • Second Comprehensive Review of the IFRS for SMEs Accounting Standard
  • Disclosure Initiative — Subsidiaries without public accountability: Disclosures
  • Dynamic Risk Management
  • Maintenance and Consistent Application
  • Board work plan update
  • Post-implementation review of IFRS 9
  • Primary financial statements
  • Disclosure Initiative — Targeted Standards-level Review of Disclosures
  • Rate-regulated activities
  • Goodwill and impairment

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.

Agenda papers available for the UK Endorsement Board Meeting on 19 May 2022

13 May 2022

The meeting agenda and papers for the UK Endorsement Board (UKEB) meeting on 19 May are available.

The agenda items for discussion are as follows:

  • Endorsement of 2021 NSA – Approval of PIP
  • ISSB Exposure Drafts – Draft Comment Letter
  • Research Project: Intangibles – Update 
  • Ongoing monitoring of IASB Projects: Primary Financial Statements
  • IFRS 17 – Response to IFRS Interpretations Committee’s Tentative Agenda Decision

The meeting agenda and papers and details of how to register are available on the UKEB website.

A meeting recording will also be available on the UKEB website.

Agenda for the May 2022 DPOC meeting

10 May 2022

The Due Process Oversight Committee (DPOC) will be meeting via video conference on 17 May 2022.

The agenda for the DPOC meeting is sum­marised below.

Tuesday, 17 May 2022 (12:00-13:30)

  • In­tro­duc­tion
  • IASB Third Agenda Consultation
  • Review of the Post-implementation Review of IFRS 10, IFRS 11 and IFRS 12
  • Post-implementation Reviews — Improving Communications

The agenda item on improving the communications around post-implementation reviews concerns addressing an expectation gap that seems to have arisen around what post- implementation reviews (PIRs) are about and what to expect as an outcome. In an attempt to more clearly communicate to stakeholders PIR objectives, process and possible outcomes, the staff is in the process of drafting an updated description of PIRs for the IFRS Foundation website. The description is derived from the Due Process Handbook but tries to more clearly articulate key points. The paper for the meeting sets out the main clarifications to the description in the Due Process Handbook. It also notes that the DPOC plans to update the Due Process Handbook for the creation of the International Sustainability Standards Board (ISSB), which the staff thinks might be a good point of time to improve the description of PIRs in the Due Process Handbook in line with the clarifications currently being developed for the IFRS Foundation website.

Agenda papers for the meeting are available on the IFRS Foundation website.

IPSASB launches global consultation on public sector sustainability reporting

10 May 2022

The International Public Sector Accounting Standards Board (IPSASB) has issued a consultation paper 'Advancing Public Sector Sustainability Reporting'.

The introduction to the consultation paper argues that while there has recently been significant progress towards the development of a global baseline for sustainability reporting in the private sector, public sector sustainability reporting has yet to move forward in the same way. At the same time, the paper goes on to state, governments are significant in expenditure and employment terms in all jurisdictions, as well as in the global bond market. How and where they spend the money they raise through the taxes everyone pays will therefore be critical in successfully delivering the United Nation’s Sustainable Development Goals.

The consultation paper now released proposes the IPSASB:

  • serve as the standard setter for global public sector specific sustainability guidance, drawing upon its experience, processes, and global relationships;
  • develop initial guidance focused on general disclosure requirements for sustainability-related information and climate-related disclosures; and
  • approach guidance development at an accelerated pace, with a potential for releasing initial guidance by the end of 2023.

Comments on the consultation paper are requested by 9 September 2022.

Please see the IPSASB website for a press release as well as an access page for a video introduction, the consultation paper, a consultation overview, and an At a Glance summary.

Summary of the 28 March 2022 CGRR meeting

09 May 2022

The Consultative Group of Rate Regulation (CGRR) held a virtual meeting on 28 March 2022. The meeting summary of the meeting has now been released.

The meeting focused on an approach to ‘how the IASB might respond to feedback on its proposals on the accounting for regulatory assets and regulatory liabilities arising from differences between the recovery pace of the regulatory asset base and the assets’ useful lives’.

The meeting summary is available on the IFRS Foun­da­tion’s website.

Report on the spring 2022 IFASS meeting

09 May 2022

A report has been issued summarising the discussions at the meeting of the International Forum of Accounting Standard Setters (IFASS) held by remote participation on 7 and 8 March 2022.

As reported earlier, among the topics discussed at the meeting were the second review of the IFRS for SMEs and sustainability reporting.

The full list of topics discussed at the meeting was:

  • Update on “Restoring trust in audit and cooperate governance”
    • Presentation by the FRC on the UK Government consultation
  • Separate financial statements
    • Presentation by the KASB and continuation of discussions from previous IFASS meetings
  • Non-current liabilities with covenants – Thoughts on the IASB exposure draft
    • Presentations by UKEB and MASB
  • Disclosure initiative — Targeted standard-level review of disclosures
    • Presentation by EFRAG on its field testing of the proposals in the IASB exposure draft
  • Supplier finance arrangements
    • Presentation by EFRAG
  • Review of the IFRS for SMEs
    • Presentation by the IASB
  • International financial reporting for non-profit organisations – IFR4NPO project update
  • Sustainability-related reporting items
    • Strategic level update on the ISSB work (ISSB)
    • Update on EFRAG Project Task Force on European sustainability reporting standards (ANC)
    • Sustainability-related reporting (AASB)
    • General update on sustainability related reporting project in a specific jurisdiction (KASB)
    • Discussion on all sustainability-related reporting presentations
  • PIR of IFRS 9 (classification and measurement)
    • Presentations by AASB, CASC, EFRAG, HKICPA, ICAI, and MASB
    • Break-out sessions
    • Plenary session with presentation of group discussions

The next meeting is to be held on 27-28 September 2022 in London.

Please click for the full report from the meeting.

Agenda papers available for the UK Endorsement Board Meeting on 9 May 2022

06 May 2022

The meeting agenda and papers for the UK Endorsement Board (UKEB) meeting on 9 May are available.

The meeting will discuss the adoption of IFRS 17 Insurance Contracts

The meeting agenda and papers and details of how to register are available on the UKEB website

The meeting recording can be found on the UKEB website here.  

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