The newsletter contains a summary from the EFRAG meeting held in May 2012. Among other topics, EFRAG discussed three of its proactive projects: Disclosure Framework for the Notes to the Financial Statements, Considering the Effects of Accounting Standards, and The Role of Business Model in Financial Reporting.

Click for the EFRAG Update (link to EFRAG website).

Specifically, the additional workstreams are:

• Rotation - The IESBA will consider the arguments for and against a firm rotation requirement in the Code and consider whether the existing guidelines on partner rotation in the Code continue to be appropriate
• Non-assurance services - The IESBA will consider whether the code needs to be amended to include additional restrictions on auditors providing non-assurance services to their audit clients, e.g. whether "materiality" should be a consideration and whether such services should be pre-approved
• Structure of the Code - Considering how to increase the visibility of requirements and prohibitions and clarify who is responsible for meeting them
• Professional accountants in business - The IESBA will consider "whether  recent accounting irregularities reveal ethical implications for professional accountants in business" which may require additional guidance to be included in the Code.

The Staff Paper notes the following:

The IESBA recognizes that by undertaking to determine its position on mandatory firm rotation, more extensive prohibitions on the provision of non-assurance services, and other measures being debated today that have independence implications, it will not be leading the debate on these topics. However, in order for the IESBA to properly exercise its authority as a global standard setter of ethics standards for accountants, the board has determined that it needs to set out its position on these matters.

Work on many of these additional workstreams are expected to commence during 2012.

Click for more information (link to IFAC website).

The topics discussed were as follows (click through to detailed Deloitte observer notes for that topic):

Tuesday, 15 May 2012 (10:00-15:30)

• Opening comments
• Active Committee projects
  • IAS 32 Financial Instruments: Presentation — Put options written on non-controlling interests
  • IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets — Contingent pricing of PPE and intangible assets
  • IFRIC 12 Service Concession Arrangements — Payments made by an operator in a service concession arrangement
  • IAS 37 Provisions, Contingent Liabilities and Contingent Assets and IFRIC 6 Liabilities arising from Participating in a Specific Market — Waste Electrical and Electronic Equipment — Levies charged for operating in a specific market – Draft Interpretation
• Items for initial consideration
  • IAS 39 Financial Instruments: Recognition and Measurement — Accounting for different aspects of restructuring Greek Government Bonds
• Items for continuing consideration
  • IAS 12 Income Taxes — Recognition of deferred tax for a single asset in a corporate entity
  • IAS 16 Property, Plant and Equipment, IAS 38 Intangible Assets and IAS 17 Leases — Purchase of right to use land
  • IFRIC 15 Agreements for the Construction of Real Estate — Clarification of meaning of continuous transfer
• Post-implementation review — IFRS 8 Operating Segments
  
• Administrative session — IFRS Interpretations Committee work in progress

Wednesday, 16 May 2012 (09:00-13:00)

• Items for initial consideration (continued)
  • IFRS 3 Business Combinations — Continuing employment
  • IFRS 1 First-time Adoption of International Financial Reporting Standards — Meaning of effective IFRSs
  • IAS 41 Agriculture and IFRS 13 Fair Value Measurement — Valuation of biological assets using a residual method
  • IAS 19 Employee Benefits — Accounting for contribution based promises
  • IAS 18 Revenue, IAS 37 Provisions, Contingent Liabilities and Contingent Assets, and IAS 39 Financial Instruments: Recognition and Measurement — Regulatory assets and liabilities

Click here to go to the preliminary and unofficial notes taken by Deloitte observers for the entire meeting.

Annual Improvements 2009–2011 Cycle makes amendments to the following standards:

The amendments are effective for annual periods beginning on or after 1 January 2013, but can be applied earlier. For more information, please see the press release on the IASB's website or our Annual improvements page.

A brief summary of the changes:

• Governance. In an effort to streamline the governance structure and decision-making process, a new transitional IOSCO Board has been constituted.  The new Board will subsume the functions of IOSCO's Technical Committee (TC), the Executive Committee (EC) and the Emerging Markets Committee Advisory Board.  Mr. Masamichi Kono, Vice Commissioner for International Affairs at the Financial Services Agency of Japan (JFSA) and Chairman of the subsumed IOSCO Technical Committee, has been appointed as Chairman of the new Board.  Mr Kone will step down from the position in March 2013 and will be replaced by Greg Medcraft, Chairman of the Australian Securities & Investment Commission (ASIC)
• Cooperation. IOSCO approved a resolution that allows it to take tougher measures to encourage compliance by IOSCO members who have not yet signed the Multilateral Memorandum of Understanding Concerning Consultation and Cooperation and the Exchange of Information (MMoU). The MMoU allows member organisations to cooperate with each other in matters of enforcement.  The new resolution is designed to assist these non-signatories in overcoming obstacles in securing support from their governments or legislatures for implementing the legal and regulatory changes required for compliance with the MMoU
• Funding.  The members discussed the need for alternative sources of funding to expand services to members (especially in emerging markets), including technical assistance, education and training, and research on global global securities market issues.  The discussion included the possible creation of an IOSCO Foundation.

Click for:

• Press release "IOSCO prepares for the regulatory and financial challenges ahead" (link to IOSCO website)
• Press release "The MMoU: Ten years of enhancing cross-border enforcement cooperation" (link to IOSCO website)
• Press release "Masamichi Kono of Japan FSA to lead IOSCO’s new board" (link to IOSCO website).

The Arabic translation is available on the IASB's Arabic-language training modules webpage. In total, 28 Arabic-language modules are now available for download.

Click for full summaries and our comment letters on:

• presentation of payments of non-income taxes
• accounting for market value uplifts introduced by a new tax regime

You can access the agenda on our May 2012 IASB meeting page. We will also post Deloitte observer notes on this page as they are available.

The meeting has been truncated from its originally scheduled two days (there is currently no scheduled discussion for Friday 18 May), and precedes the joint IASB-FASB meeting to be held in Norwalk on 21-25 May 2012.

Further details of the agenda can be found on our May 2012 IASB education session page.  Any Deloitte observer notes from the meeting will also be posted on this page.