Latest IFRS updates integrated into the ESEF taxonomy

30 Dec, 2022

The European Securities and Markets Authority (ESMA) has developed amendments to the European Single Electronic format (ESEF) to update the core taxonomy to the latest updates to IFRSs.

The amendments replace the 2021 IFRS Taxonomy with the most recent one published by the IFRS Foundation in March 2022 as core taxonomy. The ESEF is amended on a yearly basis to reflect updates to the IFRS Taxonomy published by the IFRS Foundation.

Please click for the 30 December 2022 entry in the Official Journal of the European Union.

EFRAG publishes December 2022 issue of EFRAG Update

30 Dec, 2022

The European Financial Reporting Advisory Group (EFRAG) has published an ‘EFRAG Update’ summarising public technical discussions held and decisions made during December 2022.

The update reports on the EFRAG Financial Reporting Board (EFRAG FRB) webcast meeting on 21 December 2022, the EFRAG Financial Reporting Technical Expert Group (EFRAG FR TEG) webcast meeting on 1 December 2022, the EFRAG Sustainability Reporting Board (EFRAG SRB) meeting on 14 December 2022 and the EFRAG Sustainability Reporting Technical Expert Group (EFRAG SR TEG) meetings on 5 and 13 December 2022.

The update also lists EFRAG publications issued in December including:

The update also covers EFRAG FRB’s new appointments and EFRAG's sustainability reporting and related activities.

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

Memorandum of understanding signed to establish ISSB presence in Beijing

29 Dec, 2022

The Trustees of the IFRS Foundation have signed a Memorandum of Understanding with the Ministry of Finance of China to establish an International Sustainability Standards Board (ISSB) office of the IFRS Foundation in Beijing.

The Beijing office is expected to open in mid-2023. Staff of the office will focus on leading and executing the ISSB’s strategy for emerging and developing economies and act as a hub for stakeholder engagement in Asia.

Please click for additional information in the press release on the IFRS Foundation website.

Season's greetings

24 Dec, 2022

We wish all our readers a healthy and happy festive season and all the best for the New Year!

We look forward to seeing you again after the holidays and to continue to be your preferred accounting website in 2023.

IFRS Foundation Trustees hold discussion on sustainability standards

22 Dec, 2022

The IFRS Foundation Trustees have issued insights from a panel discussion held during its quarterly meeting in Seoul, South Korea. The discussion focused on IFRS Sustainability Disclosure Standards and why they are needed.

The panelists were posed two questions: (1) “how each panelist’s jurisdiction reacted to the establishment of the ISSB and the adoption of the Standards” and (2) “most significant challenges in adopting the Standards in their respective jurisdictions and suggestions on how to overcome these challenges.” Overall, the panelists welcomed the ISSB; however, there were some who were concerned with adoption of the ISSB Standards in developing and emerging countries. The panelists came to an agreement that a way to address the concern is to provide sufficient transition arrangements for implementing the Standards.

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

EU Directive on minimum taxation published in the Official Journal

22 Dec, 2022

The EU Directive to ensure a global minimum rate of taxation for multinational groups and large domestic groups in the Union has been published in the Official Journal of the European Union.

The Directive aims to ensure that large groups operating in the EU are taxed at a minimum global effective tax rate of 15%. The rules apply to all large groups (whether they operate on a purely domestic or international basis) whose annual turnover exceeds €750 million and which have either a parent company or a subsidiary in an EU Member State.

The Directive fulfils the EU's commitment to implement the agreement on global tax reform reached by the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) to combat profit shifting and base erosion (the so-called OECD Pillar Two Model Rules on minimum taxation).

The IASB is working towards mitigating possible adverse effects of the global adoption of these rules at great speed. While the OECD released the rules in December 2021, the IASB had little alternative to monitoring developments until jurisdictions began implementing them. The developments suddenly picked up speed and the IASB reacted by, in one meeting only, discussing the required amendments holistically and developing proposals that would introduce a temporary exception from accounting for deferred taxes arising from the implementation of the OECD Pillar Two rules and targeted disclosures requirements for affected companies. An exposure draft is expected in January 2023 and the DPOC has agreed to a shortened comment period of 60 days.

Please click to access the EU Directive legally anchoring the OECD Pillar Two rules in the European Union.

UKEB publishes its draft 2023/24 Regulatory Strategy for consultation

21 Dec, 2022

The UK Endorsement Board (UKEB) has published its draft 2023/24 Regulatory Strategy for consultation.

The UKEB’s work is focused on influencing the development of high-quality international accounting standards that promote the UK public good by ensuring transparency and comparability of financial information thereby underpinning confidence in the UK's capital markets.

The expected workplan for financial year 2023/24 will see the UKEB maintaining its focus on those aspects of the International Accounting Standard Board's (IASB's) agenda that are of highest priority to UK stakeholders.

The UKEB’s three-year strategy for the period 2022-25 was published in March 2022 following consultation. In the second year of the three-year strategy, the UKEB’s strategic objectives remain unchanged and it will continue to build on the previous year's work on achieving those objectives.

The strategic objectives for 2023/24 include:

  • influencing the IASB and other global players on the development of high-quality financial reporting standards; 
  • assessing all new and amended international standards for adoption in the UK on a timely basis; and 
  • maintaining a robust operations framework to support its strategic objectives.

The UKEB's 2023/24 budget is contained within the Financial Reporting Council's (FRC's) draft 3 year plan which was concurrently published.

The 2023/24 Regulatory Strategy consultation will run until 27 January 2023.

The press release and the Draft 2023/24 Regulatory Strategy are available from the UKEB website.

IASB issues podcast on latest Board developments (December 2022)

21 Dec, 2022

The IASB has released a podcast featuring IASB Chair Andreas Barckow and Executive Technical Director Nili Shah discussing deliberations at the December 2022 IASB meeting.

High­lights of the podcast include dis­cus­sions on:

  • Dis­clo­sures on the strategic framework for digital financial reporting and activities.
  • Renaming of the Business Combinations — Disclosures, Goodwill and Impairment project.
  • Reversal in the Equity Method project.
  • Progress in the Lack of Exchangeability project.
  • Proposals in the Rate-regulated and Subsidiaries without Public Accountability: Disclosures projects.
  • Tentative decisions related to the Financial Instruments with Characteristics of Equity project.
  • Update on the Management Commentary project.
  • Report on the feedback statement on the Post-implementation Review of IFRS 9 — Classification and Meaurement.

The podcast can be accessed through the press release on the IASB website.

Please click to view the detailed notes taken by Deloitte observers for the IASB meeting.

IASB issues report concluding the post-implementation review of classification and measurement requirements relating to financial instruments

21 Dec, 2022

The IASB has issued its project report and feedback statement on the Post-implementation Review (PIR) of IFRS 9 ‘Financial Instruments — Classification and Measurement’.

The project report and feedback statement provides the IASB’s conclusions on the PIR which included the following:

  • “stakeholders have no fundamental questions about the clarity or suitability of the objectives or principles in the new requirements.
  • “in general, the requirements can be applied consistently and provide useful information to the users of financial statements. However, clarification is needed in some areas to improve the understandability of the requirements.”
  • “stakeholders encounter no unexpected costs when applying or enforcing the classification and measurement requirements of IFRS 9, nor when using or auditing information the Accounting Standard requires a company to provide.”

In addition, the IASB has identified two issues that will need further research. These issues are:

  • “the assessment of the contractual cash flow characteristics of financial assets with ESG-linked features.”
  • “electronic cash transfers as settlement of a financial asset or liability.”

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

Sustainability Standards Advisory Forum membership announced

21 Dec, 2022

The Sustainability Standards Advisory Forum (SSAF) composition has been announced and will include representatives from thirteen jurisdictions and regions. The SSAF goal is to provide the ISSB with technical advice in the development of ISSB’s standard-setting.

Members include:

  • Africa:
    • Pan African Federation of Accountants (PAFA)
  • Americas:
    • Brazilian Committee of Sustainability Pronouncements (CBPS)
    • CPA Canada (as interim prior to the establishment of the Canadian Sustainability Standards Board (CSSB))
    • Group of Latin American Accounting Standard Setters (GLASS)
    • Mexican Financial Reporting Standards Board (CINIF)
  • Asia-Oceania:
    • Accounting Regulatory Department, Ministry of Finance of People's Republic of China (ARD)
    • Institute of Chartered Accountants India (ICAI)
    • Korea Accounting Institute (KAI) and the Financial Services Commission (FSC)
    • Saudi Organization for Chartered and Professional Accountants (SOCPA)
    • Sustainability Standards Board of Japan (SSBJ)
  • Europe:
    • European Financial Reporting Advisory Group (EFRAG)
    • Swiss State Secretariat for International Finance (SIF)
    • UK Financial Reporting Council

In addition, the SSAF will have three observers from European Commission, IOSCO and the United States Securities and Exchange Commission and selected meetings with the Global Reporting Initiative (GRI).

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

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