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EFRAG is looking for new Board members

07 Dec 2020

The European Financial Reporting Advisory Group (EFRAG) has published a call for candidates for new Board members.

By the end of April 2021, several of the EFRAG Board members will have served their maximum term of six years and will rotate off the Board. Other members for which the term expires are eligible for reappointment. European stakeholder organisations and national standard setters in countries that are part of EFRAG’s membership and new organisations that are joining the EFRAG membership are invited to nominate candidates.

Please click for more information on the EFRAG website.

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Deloitte IFRS Masterclass 2020

07 Dec 2020

On 8-10 December 2020, Deloitte Middle East offers the IFRS Masterclass 2020 as an online event. There is no charge for attending, however, prior registration is required.

Each day of the event offers a keynote address by a member of the Deloitte Global IFRS Leadership Team (addressing IFRS 9, IFRS 15, and IFRS 16, respectively), which is then followed by a roundtable on industry perspectives or on technical and implementation questions, followed again each day by a Q&A session. Spanning all three days of the event, there is a three-part series on the impact of COVID-19 on financial reporting.

Please click for more information and registration for the event.

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December 2020 IASB meeting agenda posted

07 Dec 2020

The IASB has posted the agenda for its next meeting, which will be held via video conference on 14–16 December 2020.

During the meeting, the IASB will discuss the following:

  • Maintenance and consistent application
  • Comprehensive review of the IFRS for SMEs
  • Disclosure initiative — Accounting policies
  • Primary financial statements
  • Post-implementation review of IFRS 9
  • Disclosure initiative — Subsidiaries that are SMEs
  • Financial instruments with characteristics of equity
  • Pension benefits that depend on asset returns

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.

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FRAB minutes for June 2020 published

06 Dec 2020

The minutes of the Financial Reporting Advisory Board’s (FRAB’s) meeting of 18 June 2020 have been made available on the HM Treasury website.

The role of the FRAB is “to ensure that government financial reporting meets the best possible standards of financial reporting by following Generally Accepted Accounting Practice (GAAP) as far as possible”. The FRAB includes representatives from the accountancy profession in the private and public sectors, academia and government bodies. The board meets regularly to consider proposed changes to policy and practice.

Key topics discussed during the June meeting included:

  • An update on the 2020-21 reporting cycle.
  • Updates on IFRS 16 Leases and an implementation update on IFRS 17 Insurance Contracts.
  • An update on the CIPFA/LASAAC Code of Practice on Local Authority Accounting in the United Kingdom.
  • An update on discussions held by and decisions made by the IFRS Interpretations Committee and an update on amendments to IFRS Standards.

The minutes and other supporting documents are available on the HM Treasury website.

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IFRS Interpretations Committee holds December 2020 meeting

04 Dec 2020

The IFRS Interpretations Committee met via video conference on 1 and 2 December 2020. We have posted Deloitte observer notes for the technical issues discussed during this meeting.

The committee discussed the feedback on one tentative agenda decision and four new issues:

Agenda decision to finalise

Supply Chain Financing Arrangements—Reverse Factoring: In June 2020, the Committee published a tentative agenda decision which analyses the presentation of liabilities arising from reverse financing arrangement in the statement of financial position, statement of cash flows and the related disclosure. The Committee decided to finalise the agenda decision with some suggested amendments in the wording.

New issues

IAS 1 Presentation of Financial Statements—Classification of debt with covenants as current or non-current: The Committee members generally agree with the analysis how an entity determine whether it has "the right to defer settlement" when a long-term liability is subject to a condition and its compliance with the condition is tested at dates after the reporting date, applying the amended IAS 1, in the three cases described.

IAS 19 Employee Benefits—Attributing benefit to periods of service: The Committee members agreed the conclusion of the periods of service an entity attributes benefit for a defined benefit plan in a scenario where the amount of the retirement benefit an employee is entitled to depends on the length of services before retirement but raised concerns it deviates from the general views in practice.

IAS 38 Intangible Assets—Configuration or customisation of costs in a cloud computing arrangement: The Committee members agreed with the analysis of the accounting for costs of configuring and customising the suppliers' application software to which it receives access in future and the reference to IFRS 15 for the identification and timing of the services provided by the supplier.

IFRS 9 Financial Instruments—Hedging variability in cash flows due to real interest rates: The Committee members agreed with the conclusion that a hedge of the variability in cash flows arising from the changes in real interest rate based on inflation index cannot be accounted for as a cash flow hedge.

For all of the new issues, the Committee members agreed that the principles and requirements in the relevant Standards provide an adequate basis to determine the appropriate accounting for the issue and that the Committee should publish a tentative agenda decision stating that no further action is required.

More In­for­ma­tion

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

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First discussion of seventh round of academic research contributions to the IASB's work

04 Dec 2020

Five teams of researchers have presented their accounting research projects to members and technical staff of the IASB. The research projects are independent but are all directly relevant to projects on the Board’s work plan. The involvement with the research programme helps the Board to ensure its standard-setting is evidence-based.

The evidence the IASB is looking for includes responses to consultative documents, fieldwork such as assessing systems changes or the hypothetical application of a proposed new financial reporting requirement, empirical analysis from studies of reported accounting data, share price relationships and analysts’ forecasts, the results of experimental studies, analytical modelling, and collecting and analysing views from surveys.

The papers in this round address the following topics (all links to the IASB website):

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Creation of new IFRS SSB

03 Dec 2020

Mark Carney, UN Special Envoy for Climate Action and Finance, has commented on the IFRS Foundation Trustees' sustainability consultation and stresses that he endorses the creation of new IFRS Sustainability Standards Board (SSB).

In September 2020, the Trustees of the IFRS Foundation published a consultation paper to assess demand for global sustainability standards and, if demand is strong, assess whether and to what extent the Foundation might contribute to the development of such standards. The paper noted the option of creating the SSB. The new board could operate alongside the IASB under the same three-tier governance structure, build on existing developments, and collaborate with other bodies and initiatives in sustainability, focusing initially on climate-related matters.

In his letter, Mr Carney notes:

The IFRS Foundation has an essential role to play in making this vision a reality, and I fully endorse your proposal for a new Sustainability Standards Board under the Foundation’s remit. The Foundation, with its track record of robust, reliable and independent global standard-setting should play a pivotal role in delivering sustainability reporting standards that are in the public interest.

Please click to download the full letter from the IASB website.

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FRC consults on annual review of FRS 101

01 Dec 2020

The Financial Reporting Council (FRC) has published Financial Reporting Exposure Draft 77 'Draft amendments to FRS 101 Reduced Disclosure Framework – 2020/21 cycle' (FRED 77) which proposes amendments to FRS 101 as a result of its latest annual review.

FRED 77 proposes limited amendments to FRS 101 to provide certain disclosure exemptions in relation to IAS 16 Property, Plant and Equipment and for consistency with IAS 1 Presentation of Financial Statements.

It also proposes an amendment to FRS 101 to remove a reference to paragraphs 39 and 40 of IAS 1. These paragraphs were deleted by Annual Improvements to IFRSs 2009–2011 Cycle, and therefore were only applicable for accounting periods beginning before 1 January 2013.

The FRC is requesting comments on FRED 77 by 28 February 2021. Please click to access the press release and consultation paper on the FRC website.

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FRC consults on revisions to ISRE (UK) 2410

01 Dec 2020

The Financial Reporting Council (FRC) has issued a consultation on proposed revisions to International Standard for Review Enagements (UK) 2410 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' (ISRE (UK) 2410).

The FRC has recently reviewed ISRE (UK) 2410 in the context of changes to auditing standards, particularly ISA (UK) 570 Going Concern. As a result, the FRC is proposing to revise parts of ISRE (UK) 2410 to ensure it remains fit for purpose in the current environment.  The FRC's specific objective in performing this limited revision to ISRE (UK) 2410 is to address a potential lack of clarity in relation to going concern when performing a review of interim financial information.

Comments are requested until 19 February 2021

A press release , Invitation to Comment and the Exposure Draft are available on the FRC website.

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