The Boards are keen to appoint members with experience in the preparation, consumption or regulation of digital financial reports, with experience in digitalised sustainability disclosures, or from emerging economies. Applications are requested by 26 May 2023. For more information, see the press release on the IFRS Foundation website.

In the recommendations and feedback statement, EFRAG observes that intangibles (including both intangible assets and other intangibles that do not meet the definition of an asset) may contain many different types of resources. EFRAG therefore recommends that all the approaches examined in the discussion paper are considered – separately or in combination, depending on the type of intangibles – in order to provide better information on intangibles.

Please click to access the recommendations and feedback statement on the EFRAG website.

EFRAG has not yet received from the European Commission the letter requesting an endorsement advice in respect of the Amendments as such letter will be sent only following the issuance of the Amendments, expected in May 2023.  Considering the tight timeline of the forthcoming due process, EFRAG is issuing, instead of its usual draft endorsement advice, a preparatory document for comments in anticipation of the endorsement advice, on the basis of the content of the Exposure Draft of the Amendments and the discussions held by the International Accounting Standards Board (IASB) on 11 April 2023 when the IASB decided to finalise the amendments to IAS 12.

Provided that the final content of the Amendments is not substantially different than the contents of the ED and the decisions taken by the IASB in April 2023, the preparatory document will be used in the preparation of EFRAG’s Final Endorsement Advice.

EFRAG's overall preliminary assessment is that the Amendments satisfy the criteria for endorsement for use in the EU and therefore recommends their endorsement.

Comments are requested by 24 May 2023.

For more information, see the press release on the EFRG website.

European enforcers examined the financial statements of 640 issuers representing an average examination rate of 16% of all IFRS issuers with securities listed on regulated markets. These examinations resulted in 225 actions taken to address material departures from IFRS.

Enforcers also assessed the non-financial information for 403 issuers, covering approximately 18% of the total estimated number of issuers required to publish a non-financial statement, resulting in 100 enforcement measures.

In both cases, financial reporting and non-financial reporting, ESMA assesses that there is significant room for improvement in disclosures of climate-related matters by issuers.

The report also looks at ESEF reporting as for financial years beginning on or after 1 January 2021, issuers must prepare their annual financial reports according to XHTML requirements and mark-up those IFRS consolidated financial statements contained therein according to iXBRL requirements.

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

The programme is now open for entries until 19 May and is a great opportunity to share stories and be publicly recognised. Shortlisted entries also receive valuable feedback and benchmarking from the panel of expert judges.

The awards are free to enter and open to all globally including individuals, businesses, charities, social enterprises, the public sector, education institutions, think tanks, collaborations and coalitions.

This year’s awards feature four categories:

• Embedding an integrated approach
• Communicating integrated thinking
• Moving financial markets
• Driving change in the finance community

The judges will also be awarding Finance for the Future Leadership Awards, recognising examples of exceptional leadership in three areas: climate, and, new for 2023, biodiversity and nature, and social impact.

The 2022 winners included NatWest, Aviva Investors, First Nations Finance Authority, Make My Money Matter, Forico and Metro Pacific Investments.

Find out more information about the awards, including case studies from winners, along with details on the judging process and criteria on the the Awards website.

The FRC is inviting all stakeholders, including audit firms, investors, regulators, and the public, to provide feedback on the proposed amendments to the AEP, which will will be used to inform the final changes.  The FRC would particularly welcome the views of statutory auditors and audit firms and other regulatory bodies, including professional associations.

Comments are requested by 5 May 2023.

A press release and the consultation are available on the FRC website.

Update 20 June 2023 - the FRC's response to the consultation is available on the FRC website.

The conversation starters are structured by topic, with an initial broad question followed by a number of more detailed follow-up questions.  They have been developed in consultation with stakeholders, including investors, audit committees, and other interested parties.

Future areas of focus may include further ESG-related considerations, approach to materiality, contextualising risk and business model, use of emerging technology and other topical issues as they emerge.

The conversation starters are available on the FRC website.

The second discussion on this topic was opened by presentations by members of the UKEB's National Standard-Setters Sustainability Forum set up to develop an understanding of connectivity issues between IFRS Accounting Standards and IFRS Sustainability Disclosure Standards and consider possible solutions that would address stakeholder needs for connectivity between information presented in companies’ sustainability reports and financial reports.

The first presentation, delivered by an AASB representative, provided an overview of connectivity between the IFRS Foundation’s Conceptual Framework and the general features of the ISSB’s [Draft] IFRS S1 General Requirements for Disclosure of Sustainability related Financial Information. It showed that the reporting objectives and the concept of materiality in both documents are very similar, however the degree of alignment in the areas of qualitative characteristics and of presentation and disclosure requirements varies. Also, while the concepts of reporting entity and reporting period are aligned, there are noticeable differences in time horizons and the going concern assumption.

A UKEB representative then presented on connectivity between financial reporting and sustainability disclosures  (link to UKEB website) in the context of asset recognition, measurement and impairment. In comparing accounting standards with related sustainability disclosure guidance in [draft] IFRS S1 and S2, the following key connectivity themes arise: judgements and estimates, impairment reviews, useful economic lives of assets, segmental reporting and disaggregated disclosures, non-economic benefits, and emerging areas.

A last presentation by a representative of the AcSB discussed provisions, an area where both financial reporting and sustainability disclosures look at expected future developments. Two key connectivity concerns were identified: Determining when the information disclosed under IFRS S1/S2 triggers disclosure/recognition in the financial statements and different approaches to the disclosure of commercially sensitive information (where the IFRS S1 exemption only applies to opportunities and the IAS 37 exemption applies to contingent assets as well as provisions and contingent liabilities).

The ensuing discussion was lively and very different opinions were expressed. They included:

• On the question of whether there might be legitimate reasons for disconnects between financial statements and sustainability disclosures, one third of participants in the room thought "yes", one third "no" and one third was not sure.
• Participants agreed, however, that even if there are justifiable disconnects, the reasons are not easily identifiable.
• Participants also agreed that (apparent) disconnects should be flagged and explained.
• The reason for (perceived) disconnects could also be an expectation gap.
• There is a need to educate users on what financial statements and reports are supposed to achieve. A corporate report cannot be expected to be "an Encyclopedia Britannica".
• Should connectivity only be focused on ISSB standards and IASB standards or should other GAAP also be considered?
• The more dimensions are considered (local GAAP, standards beyond sustainability) the more unmanageable connectivity becomes.
• Who is supposed to take action when disconnects are identified? Should action be taken at all?
• Connectivity is a two-way process. The bridge connecting the information must be anchored on both sides of the river.
• Do not look at the disconnects, look at the connects.
• One must be realistic as regards connectivity - it is not possible to constantly adapt and adjust and connectivity cannot cover all frameworks.
• Where objectives of reporting differ, connectivity does not make sense. Similarly, there are different recognition criteria and measurement criteria.
• Do not try to connect information that is (not yet) ready to be connected. The maturity of financial reporting and sustainability disclosures is very different.
• Financial reporting is a well-established, well-balanced system, to call for changes to be made quickly would be calling for opening Pandora's box.
• Connectivity is a buzz word that is much used, but little understood. This is indicative of the fact that reporting terminology generally is understood differently by different groups.

Finally, while participants agreed that the research undertaken by the Forum was interesting, thought-provoking and certainly sparked discussion, the question was raised who the addressee of that research was: preparers who should be more consistent in their reporting, users who wanted a holistic picture, or standard-setters who should review their standards.

As part of the Government Financial Reporting Review in 2019, HM Treasury committed to continue to support ongoing improvements in financial reporting and committed to producing an annual best practice report.  This latest report follows the publication of best practice examples taken from the 2017-2018 central government ARAs, published at the time of the Government Financial Reporting Review, and those contained within previous reviews of 2018-2019, 2019-20 and 2020-21 ARAs.

The expectation is that the examples will be considered by those preparing annual reports and accounts across government.

The report is divided into three sections:

• Performance reporting;
• Accountability reporting; and
• Financial reporting.

Further information and links to the examples are available on the HM Treasury website.

In the first webcast, the staff explains the recent tentative decisions made regarding items eligible for inclusion in the current net open risk position (CNOP). Financial assets measured at fair value through other comprehensive income may be included in the CNOP, while a company’s own equity and financial assets measured at fair value through profit or loss cannot be designated in the CNOP.

In the second webcast, the staff explains the tentative decisions made in the IASB’s redeliberation on the performance assessment, which will no longer require a retrospective test against the target profile but instead a capacity assessment.

The aim of the DRM project is to encourage companies to reflect better in their financial statements how interest rate risk management affects the amount, timing and uncertainty of future cash flows. The project is an attempt to bring risk management and accounting closer together by increasing transparency in the financial statements about the interest rate management activities undertaken by companies.

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