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October 2014 IASB meeting notes — Part 1

26 Oct, 2014

The International Accounting Standards Board (IASB) met at its offices in London on 22–24 October 2014. We have posted the Deloitte observer notes from Wednesday's morning sessions on the research programme, the disclosure initiative, and the IFRIC Update.

Click through for direct access to the notes:

Wednesday, 22 October 2014

You can also access the preliminary and unofficial notes taken by Deloitte observers for the entire meeting.

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EFRAG issues draft endorsement advice and effects study report on the Annual Improvements to IFRSs 2012-2014 Cycle

24 Oct, 2014

The European Financial Reporting Advisory Group (EFRAG) has issued for comment its draft endorsement advice for the use of the Annual Improvements to IFRSs 2012-2014 Cycle in the European Union (EU). EFRAG has also issued its Effects Study Report.

The International Accounting Standards Board (IASB) published 'Annual Improvements to IFRSs 2012–2014 Cycle' in September 2014.

The improvements affect IFRS 5 Non-current Assets Held for Sale and Discontinued OperationsIFRS 7 Financial Instruments: Disclosures, IAS 19 Employee Benefits, and IAS 34 Interim Financial Reporting.

EFRAG supports the adoption of these improvements and recommends their endorsement.  EFRAG’s initial assessment is that these improvements meet the technical requirements of the Regulation (EC) No 1606/2002 of the European Parliament and of the Council on the application of international accounting standards.     

EFRAG’s conclusion is supported by an Effects Study Report which considers the costs and benefits of implementing these improvements. EFRAG’s assessment is that the benefits for preparers and users in implementing these improvements outweigh the costs.

Comments are requested by 24 November 2014. 

Click for (all links to EFRAG website):

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Updated EFRAG endorsement status report for draft endorsement advice letter on annual improvements 2012-2014

24 Oct, 2014

The European Financial Reporting Advisory Group (EFRAG) has updated its Endorsement Status Report to include its draft endorsement advice letter on 'Annual Improvements to IFRSs 2012–2014 Cycle'.

The amendments were issued in September 2014 and affect IFRS 5 Non-current Assets Held for Sale and Discontinued OperationsIFRS 7 Financial Instruments: Disclosures, IAS 19 Employee Benefits, and IAS 34 Interim Financial Reporting. Endorsement of the amendments is currently expected in the third quarter of 2015.

The endorsement status report, dated 24 October 2014, is available here.

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EFRAG issues draft endorsement advice and effects study report on Equity Method in Separate Financial Statements (Amendments to IAS 27)

23 Oct, 2014

The European Financial Reporting Advisory Group (EFRAG) has issued for comment its draft endorsement advice for the use of Equity Method in Separate Financial Statements (Amendments to IAS 27) in the European Union (EU). EFRAG has also issued its Effects Study Report.

The International Accounting Standards Board (IASB) published 'Equity Method in Separate Financial Statements (Amendments to IAS 27)' in August 2014. This amendment reinstates the equity method as an accounting option for investments in subsidiaries, joint ventures and associates in an entity's separate financial statements. This means that an entity can account for investments in subsidiaries, joint ventures and associates in its separate financial statements:

  • at cost,
  • in accordance with IFRS 9 Financial Instruments (or IAS 39 Financial Instruments: Recognition and Measurement for entities that have not yet adopted IFRS 9), or
  • using the equity method as described in IAS 28 Investments in Associates and Joint Ventures.

EFRAG supports the adoption of this amendment to IAS 27 and recommends its endorsement.  EFRAG’s initial assessment is that this amendment meets the technical requirements of the Regulation (EC) No 1606/2002 of the European Parliament and of the Council on the application of international accounting standards.     

EFRAG’s conclusion is supported by an Effects Study Report which considers the costs and benefits of implementing this amendment to IAS 27. EFRAG’s assessment is that the benefits for preparers and users in implementing this amendment outweigh the costs.

Comments are requested by 21 November 2014. 

Click for (all links to EFRAG website):

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Summary of joint outreach event on macro hedging

23 Oct, 2014

The European Financial Reporting Advisory Group (EFRAG), the European Federation of Financial Analysts Societies (EFFAS) and the Association Belge des Analystes Financiers (ABAF), and the International Accounting Standards Board (IASB) have made available a summary of the discussions held during their outreach event held on 7 July 2014, which discussed the proposals and the potential impact of the IASB’s Discussion Paper ‘Accounting For Dynamic Risk Management: A Portfolio Revaluation Approach’.

The topics discussed at the meeting included:

  • A view of current practices in the banking and insurance industries and from analysts on how the information is understood and used.
  • Initial thoughts from IASB member Martin Edelmann and EFRAG Chairman Françoise Flores concerning the discussion paper.
  • Initial thoughts from attendees on the DP and the view given by the EFRAG.

For more information, see the press release and report on the EFRAG's website.

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Updated EFRAG endorsement status report for draft endorsement advice letter on amendments to IAS 27

23 Oct, 2014

The European Financial Reporting Advisory Group (EFRAG) has updated its Endorsement Status Report to include its draft endorsement advice letter on 'Equity Method in Separate Financial Statements (Amendments to IAS 27)'.

The amendments were issued in August 2014 and reinstate the equity method as an accounting option for investments in subsidiaries, joint ventures and associates in an entity's separate financial statements. Endorsement of the amendments is currently expected in the third quarter of 2015.

The endorsement status report, dated 23 October 2014, is available here.

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Agenda for November 2014 Global Preparers Forum meeting

23 Oct, 2014

Representatives from the International Accounting Standards Board (IASB) will meet with the Global Preparers Forum (GPF) in London on Thursday, 6 November 2014. The agenda for the meeting has been released, which includes updates from the IASB and IFRS Interpretations Committee, together with discussion on specific topics including research activities, emissions trading schemes, equity method of accounting and the disclosure initiative.

The full agenda for the meeting is summarised below:

Thursday, 6 November 2014 (10:00-17:00)

  • IASB update - including the Joint Revenue Transition Resource Group and an update on the leases project
  • IFRS Interpretations Committee update - including discussion on:
    • Foreign currency translation of revenue for goods/services delivered over time
    • Foreign exchange restrictions in hyperinflationary economies
    • Post-implementation review - IFRS 3 Business Combinations
  • Research activities - plans going forward
  • Emissions trading schemes - key issues to resolve
  • Equity method of accounting - practical difficulties in application
  • Disclosure initiative
    • Update on developments
    • Cohesiveness principle
    • Disclosure of cash flow information.

Agenda papers from this meeting are available on the IASB's website.

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IMA amends Principles of Remuneration

21 Oct, 2014

The Investment Management Association (IMA) has amended its Principles of Remuneration following the 2014 AGM season. The only change this year is around the use of “allowances” as a part of fixed pay.

Following its merger with the Investment Affairs division of the Association of British Insurers (ABI), the IMA is now responsible for issuing remuneration guidance setting out its members’ views on the role of shareholders and directors in relation to remuneration and the manner in which remuneration should be determined and structured.

Following the 2014 AGM season, the IMA has updated its Principles of Remuneration, noting that its members generally consider the payment of “allowances” to be inconsistent with the spirit of simplicity, clarity and pay for performance. Where a company uses such "allowances" as part of its overall remuneration package, the Remuneration Committee should clearly justify and explain why this is necessary.

The press release and revised Principles of Remuneration are available from the IMA website.

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Agenda for the Joint Transition Resource Group for Revenue Recognition meeting

20 Oct, 2014

The agenda has been released for the second meeting of the Joint Transition Resource Group for Revenue Recognition (TRG), which is being jointly held at the offices of the IASB and FASB on 31 October 2014. The TRG will discuss a number of topics related to the boards’ new revenue standard, “Revenue From Contracts With Customers” (issued as IFRS 15 by the IASB and ASU 2014-09 by the FASB).

The TRG was formed in June 2014 and is responsible for soliciting, analysing, and discussing stakeholder issues arising from implementation of the new standards in order to assist the IASB and the FASB to determine what, if any, action will be needed to address those issues.

The agenda for the meeting is as follows:

Friday, 31 October 2014

  • Introductory remarks.
  • Customer options for additional goods and services and nonrefundable upfront fees.
  • Presentation of a contract as a contract asset or a contract liability.
  • Determining the nature of a license of intellectual property.
  • Distinct in the context of the contract.
  • Contract enforceability and termination clauses.

Agenda papers from this meeting are available on the IASB's website.

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IFAC announces 2014 editions of various handbooks

20 Oct, 2014

The International Federation of Accountants (IFAC) has announced the availability of the 2014 editions of the handbooks from the International Auditing and Assurance Standards Board (IAASB), International Accounting Education Standards Board (IAESB), International Ethics Standards Board for Accountants (IESBA), and International Public Sector Accounting Standards Board (IPSASB).

The publications are:

  • 2014 Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements.
  • 2014 Handbook of International Education Pronouncements.
  • 2014 Handbook of the Code of Ethics for Professional Accountants.
  • 2014 Handbook of International Public Sector Accounting Pronouncements.

For more information, see the press release on the IFAC’s website.

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