This guide explains how to apply the three-step process to developing accounting policies by using material and examples that have been discussed by the IASB or IFRS Interpretations Committee.

For more information, see the press release on the IASB’s Web site.

The World Business Council for Sustainable Development (WBCSD) has released the 2019 edition of Reporting matters. This year’s report provides insights that aim to help companies navigate new contexts through the lens of materiality, judgement and visual language. Three addendum reports explore distinct aspects of reporting. The press release on the WBCSD website offers access to all reports.

The Task Force on Climate-related Financial Disclosures (TCFD) announces that it is forming an advisory group to assist the TCFD in developing practical guidance on climate-related scenario analysis. Please click for the announcement on the TCFD website.

The International Federation of Accountants (IFAC) has published a point of view Enhancing Corporate Reporting. The point of view discusses the need for enhancing the corporate reporting system, integrated reporting, and the role of the accountancy profession in enhancing corporate reporting. Please click to access the point of view on the IFAC website.

The CFA Institute announces in its latest report ESG Disclosures In Asia Pacific that as the Asia Pacific investment community increasingly integrates material ESG factors into the investment management process, there has been a notable increase in demand for issuers to provide high quality, comparable and relevant ESG information. Please click to access the report through the press release on the website of the CFA Institute.

The WBCSD and the Institute of Chartered Accountants in England and Wales (ICAEW) have launched guidance on non-financial assurance. The publication is designed to demystify common misconceptions about assurance and help users procure fit-for-purpose assurance services. Please click to access the guidance through the press release on the ICAEW website.

Deloitte (UK) has commented on Recommendations for SDG Disclosures: a consultation paper jointly published by the Association of Chartered Certified Accountants (ACCA), Chartered Accountants Australia and New Zealand (CAANZ), and the Institute of Chartered Accountants of Scotland (ICAS). Please see our comment letter here.

The guide sets out the main principles involved in creating accounts in eXtensible Business Reporting Language (XBRL) under the FRS 101, FRS 102, FRS 105, Charities FRS 102 SORP and IFRS standards in the United Kingdom and Republic of Ireland.

It is aimed at all those preparing or consuming reports based on the XBRL taxonomies published for those standards by the FRC.

The publication is available on the FRC website.

There were four papers for the meeting (all links to the IASB website):

• Agenda Paper 2A provided an overview of the comment letters and overall feedback on the exposure draft.
• Agenda Paper 2B summarised the feedback from the comment letters on the ten questions in the exposure draft.
• Agenda Paper 2C summarised comments on areas for which amendments to IFRS17 were considered but not proposed and other comments.
• Agenda Paper 2D set out the staff recommended plan for redeliberations and asked whether the Board agreed with that plan.

The proposed redeliberation plan summarised staff recommendations for each point for the Board to decide whether it could confirm the proposed amendment at a future meeting, should consider further the feedback from respondents on the topic, or did not intend to consider further the topic.

The Board did not discuss each of the topics individually. Rather, the staff grouped the topics together into three groups:

1. Proposed amendments that could be confirmed without further discussion because of general support in the comment letters (listed in Agenda Paper 2D paragraph 7).
2. Proposed amendments that warranted further discussion as the feedback in the comment letters was constructive and provided at least a "little element" of new information (listed in Agenda Paper 2D paragraph 9).
3. Topics that did not warrant further discussion as either there was support in the comment letters for the Board not picking them up or as the feedback in the comment letters did not provide any new information (listed in Agenda Paper 2D paragraph 10).

The Board's votes translate as follows into the staff's table of proposed further actions included as Appendix A in Agenda Paper 2D:

The staff plan to present papers on the above topics to the Board at future meetings in the period from December 2019 to February 2020. The staff expect that there will sufficient time for the Board to consider the detailed feedback and finalise any resulting amendments by mid-2020.

New Issues

The Committee will discuss three new issues and recommends:

IFRS 16 Leases—Sale and leaseback with variable payments (Agenda Paper 5): If an entity sells an asset and leases it back with variable payments, how does the entity measure the ROU asset so as to determine the amount of gain or loss to be recognised at the transaction date?

IFRS 15 Revenue from Contracts with Customers—Presentation of player transfer payments (Agenda Paper 6): Does a football club transferring a player to another club recognise the transfer payment received as revenue applying IFRS 15, or instead recognises the gain or loss in profit or loss applying IAS 38?

IAS 12 Income Taxes—Tax consequences under multiple tax regimes (Agenda Paper 7): How does an entity account for deferred taxes when the recovery of the carrying amount of an asset gives rise to multiple tax consequences? In some tax jurisdictions, the manner in which an entity recovers the carrying amount of an asset—for example, whether it recovers the asset through use or through sale—determines the tax consequences that follow from such recovery.

Agenda Decision to finalise

IFRS 16 Leases—Lease term and useful life of leasehold improvements (Agenda Paper 4): In the light of comments received on the tentative Agenda Decision the staff recommend either finalising an amended Agenda Decision recommend that the IASB propose an amendment to IFRS 16 as part of the next Annual Improvements to IFRS Standards.

Committee Input to the IASB

The IASB is seeking input from the Committee on two projects.

Agenda Consultation (Agenda Paper 2): The staff are presenting an overview of the IASB’s approach to the 2020 Agenda Consultation and seeking input on the matters that should be included in the Request for Information.  

Post-implementation review of IFRS 10, 11 and 12 (Agenda Paper 3): The IASB has started a PIR of IFRS 10, 11 and 12. The Committee will discuss the agenda decisions published in relation to these Standards along and other application issues.

Work in progress (Agenda Paper 11)

There are no new matters that have not yet been presented to the Committee.

The full agenda for the meeting can be found here. We will update this page for any changes to the agenda and our Deloitte pre-meet­ing summaries for the meeting as they become available.

The topics discussed at the meeting included:

• IASB update
• IBOR — Phase 2 update
• Primary financial statements — Project update
• Accounting policies disclosure — Summary of exposure draft and gathering preliminary views from GPF members
• Post-implementation reviews of IFRS 10, IFRS 11, and IFRS 12 — Gathering GPF’s views to be considered in the Request for Information.
• Agenda consultation — Gathering GPF’s views on potential financial reporting priorities for a Request for Information related to the 2020 Agenda Consultation

The next GPF meeting will be held on 5 March 2020.

For more information, see the meeting page and the meeting summary on the IASB's website.

The topics covered during the meeting were the following (numbers in brackets are ref­er­ences to the cor­re­spond­ing para­graphs of the summary):

• Financial instruments with characteristics of equity (1–7): The ASAF discussed the various project alternatives and were supportive of the IASB’s decision to make clarifying amendments to IAS 32. Several members also expressed that a fundamental review to develop a new approach to distinguishing financial liabilities from equity is warranted.
• Dynamic risk management (8–16): The ASAF was given an update on the dynamic risk management project and provided feedback on how to perform an outreach on the core version of the DRM model.
• IBOR reform and its effects on financial reporting (17–22): The ASAF was given an update on the IBOR reform project and provided feedback on potential accounting issues to be considered during the project’s Phase II.
• Disclosure initiative — Accounting policy disclosure (23–30):  The ASAF provided preliminary views on Exposure Draft, Disclosure of Accounting Policies.
• Agenda planning and 2020 Agenda Consultation (31–38) — The ASAF discussed the proposed agenda for its December 2019 meeting and the Request for Information for the 2020 Agenda Consultation.
• Accounting policies and accounting estimates (39–43): The ASAF discussed KASB’s research project A Revisit to the Definition of Accounting Estimates.

A full summary of the meeting is available on the IASB's website.

Amendments to IFRS 17 Insurance Contracts: In June 2019 the Board issued ED/2019/4 Amendments to IFRS 17. The staff will summarise the feedback from the comment letters on the ten questions in the ED and summarise comments on areas for which amendments to IFRS 17 were considered but not proposed. The staff set out a recommended plan for redeliberations.

Implementation matters:

• Lack of Exchangeability (IAS 21): In June 2019, the IFRS Interpretations Committee discussed the difficulties in applying IAS 21 when a currency suffers from an extreme long-term lack of exchangeability and when a foreign operation has not been able to access foreign currencies using the available legal exchange mechanisms, such as with the Venezuelan Bolivar. The staff have concluded that this matter is widespread and could have a material effect on those affected and it is necessary to amend IAS 21 to address the matter.  
• Annual Improvements: The Board published ED/2019/2 Annual Improvements to IFRS Standards 2018–2020 in May 2019. The Board will consider the comments received: Subsidiary as a First-time Adopter (Amendment to IFRS 1); Fees Included in the ‘10 per cent’ Test for Derecognition of Financial Liabilities (Amendment to IFRS 9); Lease Incentives (Amendment to Illustrative Examples accompanying IFRS 16); Taxation in Fair Value Measurements (Amendment to IAS 41).
• Cryptoassets: The Board will be given updated information the staff has obtained by monitoring developments on holdings of cryptocurrencies or initial coin offerings.

Primary Financial Statements

During the drafting of the ED to replace parts of IAS 1, the staff concluded that it did not have sufficient guidance from the Board on how gains and losses from disposal or impairment of integral associates and joint ventures should be classified. The staff recommend that they be presented together with the share of profit or loss, and impairment losses and reversal of impairment, from those investments.

IFRS 3 reference to the Conceptual Framework: In May 2019, the Board published ED/2019/3 Reference to the Conceptual Framework, which proposed amendments to IFRS 3. The Board will discuss the comments received. All respondents supported updating the references in IFRS 3, albeit with some disagreement about aspects of the ED. All respondents supported the proposal. No decisions are asked from the Board.

Management Commentary: The Board will discuss what guidance the revised Practice Statement should include relating to an entity’s business model.

Disclosure Initiative: The Board will continue looking at the disclosure requirements in IAS 19 and IFRS 13. In particular it will consider recommendations for changes to those Standards so that some requirements use prescriptive language (shall) and others use less prescriptive language (such as ‘shall consider’ or ‘will normally disclose’).

Subsidiaries that are SMEs: The objective of this project is to consider providing disclosure relief for subsidiaries that are SMEs. The staff recommend that the project proceed based on the original scope (i.e. considering only subsidiaries that are SMEs) but consider later whether the scope can be expanded without significantly affecting the conclusions already reached.

IBOR Reform and the Effects on Financial Reporting: The October papers stated that the staff would bring the hedge accounting issues arising in Phase 2 for discussion with the Board at this meeting. That discussion is not on the November agenda.

More information

Our pre-meeting summaries are available on our November meeting notes page and will be supplemented with our popular meeting notes after the meeting.

The exposure draft addresses the uncertainty in practice about how an entity applies the initial recognition exemption in paragraphs 15 and 24 of IAS 12 Income Taxes to transactions that give rise to both an asset and liability on initial recognition and may result in temporary differences of the same amount.

EFRAG is supportive of the International Accounting Standards Board (IASB)'s aim to reduce diversity in practice in this area. However, it considers that the proposal to add an exception to an existing exemption may introduce added complexity.  EFRAG has concerns with the recognition 'cap' in paragraph 22A(b) for a deferred tax liability, and the consequences of this proposal in subsequent periods.

It also considers that the scope of the ED is broader than leases and decommissioning obligations but that the ED does not address the consequences of this potential wider scope.  EFRAG proposes that the IASB could just limit the scope to lease transactions.  Given the complexity of the proposals EFRAG has also considered whether the gross approach is the better solution rather than the net approach.

A press release and the final comment letter are available on the EFRAG website. 

The recommendations called for action from all stakeholders and importantly included a target of 33% representation of women on FTSE 350 Boards and FTSE 350 leadership teams (comprising the executive committee and the direct reports to the executive committee) by the end of 2020.

The fourth report highlights that “there has been some notable progress made by companies towards meeting the Reviews 33% targets for women in senior leadership positions in the FTSE 350 by the end of 2020”. It also indicates that with in the FTSE 350 there is greater than 30% of women representation on boards predominantly driven by the FTSE 250.

The report highlights that the number of women on FTSE 100 boards is “close to the target” having increased to 32.4% from 30.2% last year. It indicates that “half of all FTSE 100 boards have already met or exceeded the 33% target” but there are still a number of companies with work to do. The report also indicates that the FTSE 250 “has had its best year ever” increasing the number of women on FTSE 250 boards to 29.6% up from 24.9% last year. Just under half of the FTSE 250 have already met or exceed the 33% target but “the significant other half of the FTSE 250 index still have work to do”.

Looking forwards the report predicts that the FTSE 100 is “likely to achieve the 33% target” ahead of the 2020 deadline. Additionally if the FTSE 250 trend continues the report predicts that if “nearly half of all available appointments go to women next year, the FTSE 250 will also meet the target by the end of 2020”.

Turning to change in leadership roles the report flags that the pace of change is slow. The report indicates that a significant “step up in the appointment rate of women” highlighting that unless half of all appointments made this year go to women “the FTSE 350 will miss their target”.

Update 08/02/2020 - the number of FTSE 100 board members that are women is now 33%.  However the government has highlighted a "concerning lack of female representation in senior leadership and key executive roles in FTSE companies".  For the FTSE 250, the number of board members that are women is 29.5%.  The latest press release can be found on the BEIS websire here.

A press release and the full report are avail­able.