December 2022 ISSB meeting notes posted

21 Dec, 2022

The ISSB met in Montreal on Tuesday 13, Wednesday 14 and Thursday 15 December 2022. We have posted our comprehensive Deloitte observer notes for all projects discussed during the meeting.

The following topics were discussed:

ISSB Consultation on Agenda Priorities

The ISSB has begun work on a Request for Information (RFI) as part of its consultation for developing its work plan. The RFI will include two main components: foundational work and potential projects. ISSB staff have conducted outreach and research activities to put together a short-list of potential projects to be considered for inclusion within the RFI. The four potential projects identified are biodiversity, including ecosystems, ecosystem services and other nature-related issues; human capital, with a focus on diversity, equity and inclusion (DEI); human rights, particularly in the context of the value chain, with a focus on worker, labour and community rights; and connectivity in reporting, management commentary and integrated reporting. The ISSB voted in favour of including these four projects, with the caveat that they are further built out to include an expanded description as well as explicit examples of subtopics within each potential project.

General Sustainability-related Disclosures

The ISSB decided to provide some clarifications to the proposals: the framing and objective of [draft] S1 in with respect to the relationship between value and sustainability; and identifying sustainability-related risks and opportunities and assessment of material information.

Climate-related Disclosures

The ISSB decided to address specific feedback received during the comment period in relation to the disclosure requirements for Scope 1 and 2 GHG Emissions. For Scope 3 GHG emissions the ISSB decided to provide some disclosure relief, introduce a framework for measuring Scope 3 GHG emissions, provide relief related to an entity’s value chain, require an entity to reassess the ‘scope’ of its sustainability-related risks and opportunities in its value chain only upon the occurrence of either a significant event or a significant change in circumstances, and confirm that no additional relief will be provided regarding the proposal that an entity is required to include information about which of the 15 Scope 3 GHG emissions categories described in the GHG Protocol Value Chain Standard are included within the entity’s measure of Scope 3 GHG emissions. In relation to financed emissions, the ISSB decided to confirm the proposed disclosure requirements for financed emissions for three industries—Asset Management & Custody Activities, Commercial Banks and Insurance but not for the Investment Banking & Brokerage industry. The ISSB decided to make other more detailed changes recommended by the staff.

Please click to access the detailed notes taken by Deloitte observers for the entire meeting.

IFRS Foundation appoints five new Trustees

21 Dec, 2022

The IFRS Foundation has announced the appointment of Koushik Chatterjee, Sukjoon Lee, Steven Maijoor, Isabel Saint Malo, and Wencai Zhang as Trustees of the IFRS Foundation. Their appointments will begin on 1 January 2023 and will expire on 31 December 2025.

In addition, the current IFRS Foun­da­tion Trustee member Maria Theofilaktidis has been reap­pointed to serve a second three-year term.

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

FRC announces thematic review and priority sectors for 2023/24

20 Dec, 2022

The Financial Reporting Council (FRC) has announced its areas of supervisory focus for 2023/24, including high priority sectors, for corporate reporting reviews and audit quality inspections.

The FRC’s Supervision Division will supplement its routine reviews of corporate reporting with four thematic reviews: 

  • IFRS 17 Insurance contracts:  The FRC will review a selection of insurers’ 2023 interim accounts to identify compliance with IFRS 17 and examples of good disclosures.
  • Large private companies: The proposed change to the definition of a Public Interest Entity will bring an enhanced regulatory focus on the largest private companies.  The FRC will review a selection of private companies’ annual reports to identify whether and where there are areas of poor compliance with reporting requirements with a view to informing its monitoring activities going forward. 
  • Task Force on Climate-related financial Disclosures (TCFD) – metrics and targets:  Following the FRC’s thematic review of TCFD disclosures in 2022 which highlighted room for improvement in many companies’ metrics and targets disclosures, the FRC will undertake a targeted follow-up in 2023, with a focus on the metrics and targets disclosures of companies from four relevant sectors. The FRC will also consider how adequately these companies’ net zero commitments have been addressed in their financial statements.
  • IFRS 13 Fair value measurement:  The FRC’s review will focus on companies in the non-financial sector, and will provide an overview of the disclosure requirements of the standard, highlighting examples of better disclosure and common pitfalls.

The audit thematic reviews will focus on the topics of sampling, hot reviews, network resources and service providers and root cause analysis.

The FRC's Supervision programme of audit quality inspections will pay particular attention to the auditor’s work in the following areas:

  • Going concern.
  • Fraud risks.
  • Climate-related risks, including the linkage between the audited financial statements and climate-related disclosures elsewhere in the Annual Report.
  • The application of the revised Auditing Standard on risk identification and assessment (ISA (UK) 315).

In selecting corporate reports and audits for review, the FRC will give priority to travel, hospitality and leisure, retail and personal goods, construction and materials and industrial transportation. 

A press release is available on the FRC website.

December 2022 IASB meeting notes posted

20 Dec, 2022

The IASB met in London on Tuesday 13, Wednesday 14 and Thursday 15 December 2022. We have posted our comprehensive Deloitte observer notes for all projects discussed during the meeting.

The following topics were discussed.

Financial Instruments with Characteristics of Equity (FICE)

The IASB decided that no changes are made to the presentation requirements in IAS 32 for equity instruments or to specifically address financial liabilities containing contractual obligations to pay amounts based on the entity’s performance or changes in the entity’s net assets. However, the IASB decided that entities with these types of financial liabilities measured at fair value through profit or loss be required to disclose the total gains or losses recognised in profit or loss in each reporting period that arise from remeasuring such financial liabilities.

Work Plan

In the meeting, the staff set out its expectations that the IASB will conclude its post-implementation review (PIR) of the classification and measurement requirements in IFRS 9 with the publication of its Feedback Statement in December 2022. The staff also expects that the IASB will conclude its Disclosure Initiative—Targeted-Standards Level Review of Disclosures with the publication of its Project Summary in Q1 2023. In addition, the staff expects that the IASB will issue final amendments for International Tax Reform—Pillar Two Model Rules and Supplier Finance Arrangements in Q2 2023. No decisions were made.

Rate-regulated Activities

The IASB decided that an entity does not recognise inflation adjustments to the regulatory capital base as a regulatory asset. The IASB also decided that an entity recognises a regulatory asset (regulatory liability) relating to an allowable expense or performance incentive included in its regulatory capital base when the entity has an enforceable present right (obligation) to add (deduct) the allowable expense or performance incentive to (from) future regulated rates and there is a direct relationship between the entity’s regulatory capital base and its property, plant and equipment. An entity does not recognise a regulatory asset (regulatory liability) relating to an allowable expense or performance incentive included in its regulatory capital base when there is no direct relationship between the entity’s regulatory capital base and its property, plant and equipment.

Maintenance and consistent application

The IASB discussed matters raised in the feedback on the Exposure Draft (ED) Lack of Exchangeability. The IASB decided to proceed with its proposals in the ED with some changes. In particular, the IASB agreed to clarify for factors to consider when assessing exchangeability that an entity does not consider ‘unofficial markets’ in assessing exchangeability but, when exchangeability is lacking, it can use exchange rates from these markets to estimate the spot exchange rate and that all factors are to be considered holistically. For determining the spot exchange rate—the IASB decided to amend proposed paragraph 19A to state that an entity’s objective in estimating the spot exchange rate is to reflect at the measurement date the rate at which an orderly exchange transaction would take place between market participants under prevailing economic conditions.

Equity Method

In this session, the IASB discussed applying the preferred approach after purchase of an additional interest in an associate and two application questions. The IASB decided to proceed with the view that an investor is measuring a single investment in the associate rather than layers of the investment in the associate. The IASB also decided that an investor that has reduced its interest in an associate to zero does not recognise the unrecognised losses from the cost of the additional interest in the associate. Lastly, the IASB decided that an investor recognises its share of comprehensive income until its interest in the associate is reduced to zero.

Goodwill and Impairment

The IASB agreed to move the project from the research programme to the standard-setting work plan. The IASB decided to maintain its preliminary view and therefore to make no changes to the recognition criteria in IFRS 3 for identifiable intangible assets acquired in a business combination. The IASB decided against proceeding with its preliminary view to require an entity to present the amount of total equity excluding goodwill as a separate line item on its statement of financial position. The IASB decided not to consider additional topics suggested by respondents in this project, except for two topics related to possible improvements to the effectiveness of the impairment test of cash-generating units containing goodwill.

Digital Financial Reporting Strategy

The IASB discussed the strategic framework that is intended to provide strategic direction and boundaries to help identify possible digital financial reporting activities that the IASB could undertake and provide consistent language for communicating the digital financial reporting strategy. The IASB did not make any decisions.

Disclosure Initiative—Subsidiaries without Public Accountability: Disclosures

The IASB confirmed its proposals in the draft Standard that the application of the disclosure requirements in IFRS 8, IFRS 17 and IAS 33 remain applicable for a subsidiary applying the Standard, and that an entity is permitted to apply reduced disclosure requirements for IAS 34 in the Standard. The IASB also decided to retain its proposal that a subsidiary applying the new Standard be required to disclose that it has applied the Standard in the same note as its explicit and unreserved statement of compliance with IFRS Accounting Standards.

An analysis of how the IASB’s work plan has changed as a result of the meeting is available here.

Please click to access the detailed notes taken by Deloitte observers for the entire meeting.

Updated IASB and ISSB work plan — Analysis (December 2022)

19 Dec, 2022

Following the IASB's and ISSB's December 2022 meetings, we have analysed the work plan on the IFRS Foundation website to see what changes have resulted from the meetings and other developments since the work plan was last revised in November 2022.

Below is an analysis of all changes made to the work plan since our last analysis on 28 November 2022.

Stan­dard-set­ting projects

  • Business combinations: Disclosures, goodwill and impairment — This project is the project formerly known as Goodwill and im­pair­ment — has been moved form the research agenda to the standard-setting agenda of the IASB; the next project milestone will be the publication of an exposure draft (no date given).

Main­te­nance projects

  • Amend­ments to the clas­si­fi­ca­tion and mea­sure­ment of financial in­stru­ments — This project exposure draft is now expected in Q1 2023 (pre­vi­ously Q2 2023).
  • Lack of ex­change­abil­ity (amend­ments to IAS 21) — After a decision on the project direction, final amendments to IAS 21 are expected in H1 2023.
  • Supplier finance arrange­ments — Amend­ments are expected to be issued in Q2 2023 (previously H1 2023).

Research projects

  • Post-implementation review of IFRS 9 — Impairment — A request for information is now expected in Q2 2023 (previously H1 2023).

Other projects

  • IFRS accounting taxonomy update — 2022 General Im­prove­ments and Common Practice — Feedback on the proposal is expected in February 2023 (previously Q1 2023).
  • IFRS accounting taxonomy update —amend­ments to IFRS 16 and IAS 1— Feedback on the proposal is expected in January 2023 (previously Q1 2023).

The above is a faithful com­par­i­son of the IASB and ISSB work plan at 28 November 2022 and 19 December 2022. For access to the current work plan at any time, please click here.

IASB Chair discusses IFRS 17 effective date

19 Dec, 2022

IASB has provided a short video by Chair Andreas Barckow on the upcoming effective date of IFRS 17 ‘Insurance Contracts’. Dr Barckow reminds stakeholders that the effective date for the Standard will be on 1 January 2023 and that there are supporting resources available on the IFRS Foundation’s website.

For more information, see the video and the IFRS 17 supporting materials webpage on the IFRS Foundation’s website.

New IASB Vice-Chair appointed

19 Dec, 2022

The Trustees of the IFRS Foundation have announced the appointment of Linda Mezon-Hutter as Vice-Chair of the IASB.

Ms Mezon-Hutter was appointed IASB Board member in September 2022. Before that, she served as a member, Vice-Chair and ultimately Chair of the Canadian Accounting Standards Board (AcSB). She has also served on the IASB’s Accounting Standards Advisory Forum. Before joining the AcSB, Mezon-Hutter served as the Chief Accountant at Royal Bank of Canada.

Please see the press release on the IFRS Foundation announcing her appointment.

FRC publishes its draft 3-year Plan and Budget for 2023-26

18 Dec, 2022

The Financial Reporting Council (FRC) has published a consultation on its 3-year plan and budget for 2023-2026. Comments are requested by 27 January 2023.

The plan reflects the delay of anticipated legislation to create the Audit, Reporting and Governance Authority (ARGA), which has had an impact on the associated increase in capacity, cost and headcount previously expected to occur in 2023.  Overall the budgeted cost of the FRC and the UK Endorsement Board will increase to £69.7m from £59.8m last year with a 9.7% increase in budgeted headcount by March 2024.

The plan details how each of the FRC's four divisions (Regulatory Standards, Supervision, Enforcement and Corporate Services), intend to organise their work and the associated deliverables across the three year period of the plan.  It also sets out the FRC's strategic priorities and deliverables for 2023/24 in these areas as follows:

Regulatory Standards

  • Development and maintenance of standards and codes, including completion of the periodic review of FRS 102, adoption of a revised International Standard on Auditing (ISA) (UK) 500 Audit Evidence, post-implementation reviews of UK auditing standards, in particular ISA (UK) 540 Accounting Estimates and Related Disclosures, review of the UK Corporate Governance Code, and post-implementation review and revision of technical actuarial standards (TAS).
  • International influencing of auditing, assurance and ethical standards, and significant contribution to non-financial reporting developments in the UK and internationally (especially sustainability reporting).
  • Policy support for ARGA’s local audit systems leader role.
  • Activities focused on improvements and innovation to support high-quality reporting and audit including Lab publications and use of the new ‘Audit Sandbox’.
  • Promoting the use of technology throughout its policy areas, through digital reporting and the implications for data and data governance, and commencing the Company and Organisational Data Explorer (CODEx) project.
  • Supporting the FRC’s objectives and activities through increased stakeholder engagement with impact and influence, including website improvements, connected and systematic development of publications, webinars, and podcasts, focused on collective impact.


  • Delivering a full programme of high-quality AQR inspections, CRR reviews and the FRC’s statutory professional oversight functions and publish associated reporting, including thematic reviews.
  • Increase activities focused on improvements and innovation to support improved audit quality and resilience in the market, including implementation of the FRC Scalebox.
  • Approval and registration of audit firms and responsible individuals who undertake Public Interest Entity (PIE) audit work.
  • Assessing the effectiveness of the firms’ implementation of new auditing and quality management standards.
  • Developing a supervisory approach for audit committees.
  • Developing the supervisory oversight strategy for the professional bodies.
  • Developing the local audit system leader role and team in shadow form ahead of ARGA implementation.
  • Reporting on implementation of operational separation.
  • Developing market monitoring function.
  • Delivering projects on developing AQR and Improving the Quality of Auditor Education and Training.


  • Fair, robust, and timely case closures, or conclusion through focus of investigations, prioritisation, training, and recruitment.
  • Upskilling and training to respond to changes in AEP from January 2022 and to intended changes to procedural published guidance.
  • Collaboration with the Department for Business, Energy, and Industrial Strategy (BEIS) on planned legislative change to reach the best achievable outcomes as they pertain to enforcement and the FRC’s stated purpose and objectives.
  • Upskilling to enable full implementation of future powers arising from proposed regulatory reform in 2024 onwards.
  • Publication of the Annual Enforcement Review, delivering transparency and driving improved behaviours through messaging case outcomes.

Corporate services

  • Developing a statutory funding model for ARGA.
  • Developing and implementing an integrated information management strategy, including a medium-term IT strategy and enhanced cybersecurity risk management.
  • Data analytics and reporting, economic advice and impact assessment – supporting enhanced market monitoring, the implementation of the FRC position paper, and transition to ARGA.
  • Appropriate workforce planning, aligned with its business planning cycle and designed to incentivise, reward, and retain key skills and accommodate any re-location plans.
  • Strengthening its support infrastructure, including in finance and procurement systems, internal controls, and IT.
  • Enhancing the level of assurance activity, against internal policies and controls.
  • Legal support for all FRC activities and legal and operational support for the UKEB.
  • Embedding its contingency planning processes and testing regime. 

The draft 3-year plan also covers other areas such as risks and challenges and KPIs. The FRC also sets out its proposed budget for 2023/24 for expenditure and funding.

The press release and draft 3-year Plan and Budget 2023-26 are available from the FRC website.

UK government delays process for legislating for the UK Green Taxonomy

16 Dec, 2022

The UK Government has confirmed that it will delay the process for legislating for the UK Green Taxonomy

The Government cited as reasons the complexity of the task; the importance of proceeding carefully; and its desire to review its approach to taxonomy development to maximise the effectiveness of its sustainable finance agenda. In response, the Green Technical Advisory Group (GTAG) has said that it will continue to advise the Government on developing and implementing a Green Taxonomy and that “the priority should be to ensure the design and implementation of such a complex policy instrument is done in a way that maximises its usability and usefulness for the market”.

The Government will provide a further update in early 2023 on how it will take forward legislation on the Green Taxonomy as part of its publication of its Green Finance Strategy. Under the Taxonomy Regulations, the government was required to set technical screening criteria by 1 January 2023. It will repeal that obligation.

The written statement is available on the government website and the statement from the GTAG is available on the Green Finance Institute website.

Agenda for the January 2023 IFASS meeting

16 Dec, 2022

The International Forum of Accounting Standard Setters (IFASS) will hold an interim virtual meeting on 12 January 2023.

The full agenda for the meeting is summarised below.

Thursday, 12 January 2023 (12:00–14:00)

  • Welcome and opening remarks
  • IASB and ISSB update (IASB and ISSB)
  • Connection between financial and sustainability reporting (UKEB and EFRAG)
  • IAS 12 temporary exception amendment (IASB)
  • IFRS 16 research (ANC)
  • Transition relief and ongoing practical expedients in IFRS 16 Leases (AASB and MASB)
  • Closing remarks

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