While the IFRS Foundation Constitution affords the ISSB the option to publish exposure drafts for public comment when approved by its Chair and Vice-Chair, and subject to oversight by the Trustees’ Due Process Oversight Committee, a quorum of eight members is required for the ISSB to deliberate on feedback received on the exposure drafts and for final requirements to be published. With the Chair and Vice-Chair already appointed, the Trustees will now focus on appointing a first set of six ISSB members from among the applications received so far. The press release notes that further applications are still welcome, which would then be considered in the next round of appointments.

The Trustees note that this approach will (a) enable the ISSB to begin its work and move at the pace required by stakeholders and (b) allow them, at each step, to build further the diversity and breadth of profiles and expertise of the ISSB.

The press release states that a similar approach is being taken to determining the membership of two key advisory bodies to the ISSB: the Sustainability Consultative Committee and the Sustainability Standards Advisory Forum.

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

The ASAF is comprised of 12 members and a non-voting chair. The new composition for 2022-2024 is as follows:

Please click for the press release on the IASB website.

The agenda items for discussion are as follows:

• IFRS 17: Summary of Public Consultation Feedback on DECA
• IFRS 17: Reinsurance to Close Transactions
• Adoption of May 2020 amendments to international accounting standards
• Subsidiaries without Public Accountability: Disclosures— Final Comment Letter
• Items for Noting

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.

In September 2021, the IASB issued a RFI seeking comments from stakeholders to identify whether the classification and measurement requirements in IFRS 9 Financial Instruments provide information that is useful to users of financial statements; whether there are requirements that are difficult to implement and may prevent the consistent implementation of the standard; and whether unexpected costs have arisen in connection with applying or enforcing the standard.

In its final comment letter, which has been informed after in-house research, a stakeholder survey and feedback received during stakeholder roundtables and interviews, the UKEB: 

• ob­serves that the IFRS 9 clas­si­fic­a­tion and meas­ure­ment re­quire­ments gen­er­ally work as in­ten­ded and rep­res­ent an im­prove­ment to the pre­vi­ous rule-based re­quire­ments in IAS 39 Fin­an­cial In­stru­ments: Re­cog­ni­tion and Meas­ure­ment.
• focuses on three significant areas where it con­siders im­prove­ment and po­ten­tially stand­ard-set­ting activ­ity are re­quired.  Two of the areas relate to the ap­plic­a­tion of the con­trac­tual cash flow char­ac­ter­ist­ics as­sess­ment for fin­an­cial assets while the third area relates to the ef­fect­ive in­terest rate meth­od­o­logy.
• sug­gests that the IASB ad­dresses the issue con­sidered in the recent IFRS In­ter­pret­a­tions Com­mit­tee tent­at­ive agenda de­cision Cash Re­ceived via Elec­tronic Trans­fer as Set­tle­ment for a Fin­an­cial asset as part of this Post-im­ple­ment­a­tion Review.

The final comment letter and the feedback statement are avail­able on the UKEB website.

The IASB published the exposure draft 'Non-current Liabilities with Covenants (Proposed amendments to IAS 1)' in November 2021 to clarify how conditions with which an entity must comply within twelve months after the reporting period affect the classification of a liability. 

The UKEB sup­ports a number of the proposals con­tained within the ED but high­lights the fol­low­ing concerns:

• The UKEB does not support the specific requirement for separate presentation in the Statement of Financial Position (paragraph 76ZA (a) of the ED) as it believes that the current general requirements in IAS 1 Presentation of Financial Statements are sufficient.
• The potential for unintended consequences of the some of the ED's proposals especially regarding the meaning of 'specified conditions' in paragraph 72B and the application of paragraph 72C(b) when determining if a liability is current.  The UKEB has encountered significant diversity in interpreting the intent of paragraph 72C(b) and suggests that paragraph 72C be deleted.

Com­ments are re­ques­ted by 07 March 2022. 

The draft comment letter and the in­vit­a­tion to comment are avail­able on the UKEB website.

Ninety-one per-cent of local bodies in England missed the statutory deadline of 30 September 2021 for the publication of their audited 2020/21 accounts, meaning that only 9% of audited accounts were published by the deadline.  This trend continued after the 30 September deadline where only 40% had been published by December 2021.  In order to try to alleviate this issue, CIPFA LASAAC considered a number of options and focus on two of these in the consultation.  The options considered in the consultation are:  

• Pausing the requirements for professional valuation of operational property, plant and equipment assets in the 2021/22 Code and (at least) the 2022/23 Code, with the possibility of mitigating the effect of this through the application of centrally determined indices.
• Deferring the implementation of IFRS 16 Leases for a further year and reversing the planned changes to the 2022/23 code to implement that standard.

If the proposals being consulted on were endorsed, one of the options would be effective for 2021/22 and so come into force shortly before 31 March 2022.  The remaining option relates to the 2022/23 Code.

Com­ments are re­ques­ted by 23:00 on 3 March 2022. 

Click for (all links to the CIPFA website):

• Public Release
• Invitation to comment (ITC)
• Annex One: the exposure draft which presents the changes 
• Annex Two: information on the options considered by CIPFA/LASAAC

The Board will discuss the following:

• Dynamic risk management
• Disclosure initiative — Targeted Standards-level review of disclosures
• Rate-regulated activities
• Financial instruments with characteristics of equity
• Primary financial statements
• Third agenda consultation
• Maintenance and consistent application
• Post implementation review of IFRS 10–12
• Second comprehensive review of the IFRS for SMEs Standard

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.

The FRC 'strongly supports' the development of global standards for sustainability reporting and the UK adoption of those standards.  

The FRC recommends that, in developing the new standards, the ISSB

• provides stakeholders with an outline of the architecture of the standards;
• considers the four pillars of the Taskforce on Climate-related Financial Disclosures (TCFD) in the context of the overall standards; and
• discusses to what extent governance reporting will be in the scope of ISSB standards.

The FRC's full response is available on their website.

The workshop is open to academics, standard-setters, accounting professionals and regulators and is follow-up to the request for paper submissions on diverse aspects of disclosures by the IASB, Accounting in Europe and The British Accounting Review. For more information, see the press release on the IASB’s website.

The Committee discussed an ongoing matter, the comment letter analysis for one tentative agenda decision and an educational paper.

Ongoing matter

IAS 37 Provisions, Contingent Liabilities and Contingent Assets—Negative low or new energy vehicle credits: In its November 2021 meeting, the Committee discussed a submission asking whether an entity with negative low emission vehicle credits has a present obligation that meets the definition of a liability in IAS 37. In the meeting, Committee members generally agreed with the staff's analysis that an entity that has generated negative credits has an obligation that meets the definition of a liability in IAS 37. The staff had edited the wordings according to some Committee members' suggestions and analysed the implications of the consensus in IFRIC 6 Liabilities arising from Participating in a Specific Market—Waste Electrical and Electronic Equipment in an appendix to the paper. In this meeting, despite the concerns raised by some Committee members on various aspects, the Committee decided, by a majority vote, to finalise the agenda decision with proposed refinements to the wordings.

Comment letter analysis

IFRS 9 Financial Instruments and IAS 20 Accounting for Government Grants and Disclosure of Government Assistance—TLTRO III Transactions: In its June 2021 meeting, the Committee discussed a submission asking how banks account for the European Central Bank (ECB)’s Targeted Longer-Term Refinancing Operations (TLTRO). Specifically, the submission asked whether the TLTRO III tranches are loans at a below-market interest rate which should be accounted for as a government grant. The staff analysed the comment letters and recommended finalising the agenda decision with minor editorial changes. In this meeting, despite the concerns raised by some Committee members, the staff still considered that there are merits in finalising the agenda decision and the Committee decided, by a majority vote, to finalise the agenda decision with some editorial changes.

Education session

IFRS 17 Insurance Contracts—Profit recognition for annuity contracts: The Committee received a submission about determining how to recognise unearned profit as revenue based on the services an entity provides to policyholders of annuity contracts in a scenario where an entity includes unearned profit in the measurement of insurance contracts and subsequently recognises it as revenue as the entity provides services. The paper provided an overview of the applicable IFRS 17 requirements and other background related to those requirements.

Administrative matters

Work in progress: The staff are in the process of analysing three matters:

• Rent Concessions: Lessors and Lessees (IFRS 16 and IFRS 9)
• Special Purpose Acquisition Companies (SPAC): Accounting for warrants at acquisition (IFRS 2 or IAS 32)
• Special Purpose Acquisition Companies (SPAC): Classification of Public Shares as Liabilities or Equity (IAS 32)

More In­for­ma­tion

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