IOSCO welcomes work on assurance of sustainability-related corporate reporting

16 Sep, 2022

The International Organization of Securities Commissions (IOSCO) welcomes the work of the International Auditing and Assurance Standards Board (IAASB) and the International Ethics Standards Board for Accountants (IESBA) on assurance of sustainability-related corporate reporting.

The statement released on the IOSCO website notes:

In particular, IOSCO welcomes the Boards’ plans to work towards high-quality, global assurance and ethics (including independence) standards that are profession-agnostic and can support limited, and ultimately, reasonable assurance of sustainability-related information. This work will serve to support the consistency, comparability and reliability of sustainability-related information provided to the market, enhancing trust in the quality of that information.

IOSCO also welcomes the dialogue that the IAASB and the IESBA have opened with the International Sustainability Standards Board (ISSB). IOSCO encourages continued close engagement as the standard-setters advance their respective work programmes to foster compatibility between international financial reporting, sustainability reporting, and assurance standards.

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

Agenda for the September 2022 IFASS meeting

15 Sep, 2022

The International Forum of Accounting Standard Setters (IFASS) will meet on 27-28 September 2022. The meeting will be held in London.

The full agenda for the meeting is summarised below.

Tuesday, 27 September 2022 (14:00–18:00)

  • Welcome and opening remarks
  • Overview of research on goodwill subsequent measurement (UKEB)
  • Financial instruments
    • Post-implementation review of classification and measurement (AASB)
    • ESG-linked financial instruments (FASB)
    • FVOCI recycling and impairment (OIC)
  • Break-out sessions on how to improve cash flow reporting
  • Post-implementation review of IFRS 15 (IASB and EFRAG)

Wednesday, 28 September 2022 (9:00-16:00)

  • Jurisdictional perspectives on sustainability reporting: Climate-related risk
    • ESRS E1 Climate Change (EFRAG)
    • Consultation Advancing Public Sector Sustainability Reporting (IPSASB)
    • Proposed rule on climate-related risk (SEC)
    • Panel discussion moderated by the ISSB Vice-Chair with panel members from AASB, FRC, ICPAK, KASB, and SSBJ
  • Looking ahead – What’s next after climate? (TNFD)
  • Digital assets
    • Panel discussion of key developments and implications with members from AcSB, ASBJ, EFRAG, and FASB
  • Second comprehensive review of the IFRS for SMEs
    • Introduction by IASB
    • Introduction by IFR4NPO
    • Panel discussion with members from IASB, Argentina, PAFA, Sri Lanka, and FRC
  • The way forward
    • Implications of the IASB workplan decisions for future IFASS agenda
    • Possible topics of interest from jurisdictions
    • Potential joint projects
    • Additional virtual meeting
  • Closing remarks

Upcoming World Standard-setters meeting

15 Sep, 2022

The next World Standard-setters meeting will be held on 26–27 September 2022 in London. A programme for the meeting is available on the IASB website.

A summary of the programme for the conference is set out below:

Monday, 26 September 2022 (09:00 - 17:30)

  • Opening remarks
  • IASB update, including IASB work plan for 2022‒2026
  • ISSB update and future ISSB work plan
  • Breakout sessions
    • Financial instruments
    • Goodwill and impairment
    • IFRIC update
    • ISSB work
  • Proposed third edition of the IFRS for SMEs
  • Breakout sessions, second round

Tuesday, 27 September 2022 (09:00 - 12:30)

  • Report back from day 1 of the conference
  • Primary financial statements
  • Feedback on proposed IFRS Sustainability Disclosure Standards

Please click to access the detailed programme for the event on the IASB website.

The WSS meeting will be immediately followed by a meeting of the International Forum of Accounting Standard Setters (IFASS) on 27-28 September 2022.

IFR4NPO will develop INPAG

14 Sep, 2022

International Financial Reporting for Non-Profit Organisations (IFR4NPO), an initiative to develop the first internationally applicable financial reporting guidance for non-profit organisations, has announce that its guidance will be called 'International Accounting Guidance for Not-for-Profit Organisations (INPAG)'.

INPAG will be a stand-alone guidance so that preparers and auditors can find what they need in one place. Using the IFRS for SMEs as a starting point, changes will be made to address the prioritized non-profit issues.

IFR4NPO has released a video explaining about INPAG and the vision behind them.

Agenda for the upcoming inaugural meeting of the SCC

13 Sep, 2022

The IFRS Foundation has released an agenda for the inaugural meeting on the newly formed Sustainability Consultative Committee (SCC). The SCC’s remit is to identify, inform and advise the International Sustainability Standards Board (ISSB) on priority sustainability matters and related technical protocols, as well as significant interdependencies between sustainability matters.

During its first meeting on 15 September 2022, the main discussions will focus on the current ISSB activities and the role of the SCC. There are no papers for the meeting. The full agenda is available here and registration as an observer is possible here (both links to the IFRS Foundation website).

EFRAG publishes Annual Review for 2021

12 Sep, 2022

The European Financial Reporting Advisory Group (EFRAG) has published its 2021 Annual Review.

The review highlights EFRAG’s work on sustainability reporting, as well as EFRAG's Financial Reporting activities including its research activities, contributions to improve IFRS Accounting Standards and endorsement advice projects such as on IFRS 17 Insurance contracts.

The annual review is available on the EFRAG website.

IASB meeting agenda updated for UK national holiday for Queen Elizabeth II’s funeral

12 Sep, 2022

The IFRS Foundation has announced that its office will be closed on 19 September 2022 for the national holiday for the funeral of Her Majesty Queen Elizabeth II and has reschedule the IASB September meeting.

The IASB meeting has rescheduled with the following discussions: 

  • Equity Method moved from Monday 19 September into two separate discussions on Tuesday 20 September and Wednesday 21 September.
  • Goodwill discussions moved from Monday 19 September to Tuesday 20 September.
  • Rate-regulated activities discussions moved from Tuesday 20 September to Thursday 22 September.

Meeting times have also been adjusted. The agenda page has been updated to reflect these changes.

UK Endorsement Board publishes first Annual Board Effectiveness Review

12 Sep, 2022

The UK Endorsement Board (UKEB) has published findings from its first Annual Board Effectiveness Review for the reporting period 2021/2022.

The review was commissioned by the Board and focusses on four core areas: Board governance and accountability, culture and composition, Secretariat support and leadership. It reflects upon the Board’s strengths and capabilities and considers areas for future focus and further development.

The report is available on the UKEB website.

FRC publishes thematic review of EPS

12 Sep, 2022

The Financial Reporting Council (FRC) has published the results of its thematic review into companies’ application of IAS 33 'Earnings per share' (EPS).

Whilst EPS is a well understood metric which is widely used by companies and investors, there are some aspects of its calculation that are complex and not straightforward to apply.  The FRC’s Corporate Reporting Review (CRR) Team has identified, through its routine reviews, a number of companies that have failed to fully understand or correctly apply the requirements, leading in some cases to restatements in their annual reports and accounts.

In light of these findings, the FRC’s thematic, through the use of case studies and examples, seeks to identify ways in which companies can meet the requirements of IAS 33 and provide better disclosure.  The thematic identifies a number of areas where the FRC expects improvements to be made:

  • Weighted average number of ordinary shares – although IAS 33 does not require specific disclosures to explain how this number has been determined, due to the importance of this denominator to the EPS calculation, companies should consider providing further information to explain the basis for the weighted average number of ordinary shares used in the calculation of EPS if it is significantly different from information disclosed about issued ordinary shares and potential ordinary shares (for example share options);
  • Judgements made - where judgements have been made that have a material effect on EPS (for example about the substance of a share reorganisation or other arrangement that affects how it is treated in the EPS calculation), disclosures should be made in accordance with IAS 1.122.
  • Non-GAAP ‘adjusted EPS’ - where adjusted EPS is provided, companies should ensure that the disclosures meet the requirements of the European Securities and Market Authority’s (ESMA’s) Guidelines on Alternative Performance Measures and also explain the methodology applied in calculating adjusted EPS, including the basis used for tax on adjusting items.

As well as areas for improvement, the thematic highlights the basic requirements of IAS 33, flags common pitfalls in applying the standard and reminds companies of a number of the key requirements including:

  • the definitions of dilutive and antidilutive;
  • the treatment of share reorganisations that include a bonus element;
  • adjustments required for equity preference shares; and
  • the methodology for calculating EPS when a reverse acquisition has taken place.

The FRC encourages companies to consider the findings when preparing their forthcoming EPS calculations and disclosures.

A press release and the full report are available on the FRC website.

FRC responds to International Sustainability Standards Board's request on digital reporting taxonomy

12 Sep, 2022

The Financial Reporting Council (FRC) has published its response to the International Sustainability Standard Board's (ISSB's) request for feedback to inform future development of the IFRS Sustainability Disclosure Taxonomy for Digital Reporting.

The FRC welcomes the oppportunity to respond and engage with the ISSB staff on the future development of the IFRS Sustainability Disclosure Taxonomy and believes that ensuring that the ISSB disclosures can be digitally reported and consumed is 'key to optimising the usability and usefulness of sustainability reporting'.  The FRC's letter highlights a number of overarching comments for consideration during the development of the taxonomy and should be read alongside its responses to the IFRS S1 and S2 Exposure drafts.

A press release and the FRC's response are available on the FRC website.

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