The "zero draft" of the outcome document (available on the Rio+20 website) contains the following paragraph (paragraph 24) as part of its 'framework for action':

We call for a global policy framework requiring all listed and large private companies to consider sustainability issues and to integrate sustainability information within the reporting cycle.

ACCA believes that these words express a clear goal, however, "the paragraph needs to have greater reference to the role of the private sector and accountability, and it could certainly be more action-orientated". As the implementation of resolutions has often proved to be the crux with international agreements, ACCA suggests that the paragraph should be rephrased so that it will lead to a commitment by UN member states to develop mechanisms for sustainability reporting at a national level that meet global standards at the same time.

ACCA also believes that paragraph 24 should obligate companies to report on a ‘comply-or-explain’ basis. This would force companies to consider and discuss risks and opportunities arising from sustainable development and to embed sustainability into their business strategy and key processes.

While ACCA presses for these changes there are also worries that the zero draft’s paragraph 24 will not make it intact to the final Rio+20 agreement. ACCA warns of any watering down of the paragraph (for example by replacing the Word "require" with the word "encourage") and stresses: "An effective paragraph 24 would increase the relevance of sustainability to investors and businesses and spread good practice worldwide."

Please click for the following documents on the ACCA website:

• Press release Integrating material sustainability information into corporate reports should be a key and critical outcome of Rio +20, urges ACCA
• Report Making a difference at Rio+20

Levies

The Committee considered how an entity would account for the payment of levies, other than income taxes, in its financial statements; specifically, when the liability to pay a levy should be recognised. The proposed guidance, DI/2012/1 Levies Charged by Public Authorities on Entities that Operate in a Specific Market, clarifies that "the obligating event that gives rise to a liability to pay a levy is the activity that triggers the payment of the levy as identified by the legislation".

Comments on the levies proposal are due by 5 September 2012.

Click for DI/2012/1 and the press release, both available on the IASB website.

Put options

The Committee considered how to measure the financial liability created when a parent entity is obliged to purchase the shares of its subsidiary for cash or for another financial asset, and the parent must recognise a financial liability in its consolidated financial statements for the present value of the option exercise price.

The proposed guidance, DI/2012/2 Put Options Written on Non-controlling Interests, clarifies that all changes in the measurement of that financial liability should be recognised in profit or loss in accordance with IAS 39 Financial Instruments: Recognition and Measurement and IFRS 9 Financial Instruments.

Comments on the put options proposal are due by 1 October 2012.

Click for DI/2012/2 and the press release, both available on the IASB website. A french translation of DI/2012/2 is also available.

The agenda, dated 30 May 2012, has been released.

The full agenda for the meeting can be found here.

At a recent workshop on 14 May in London, the IASB welcomed 30 participants from 20 countries for a Framework-based IFRS teaching session. Following this session, the IASB project staff provided updates on the investment entities, financial instruments, leases, and insurance projects currently on the IASB's active agenda. Further, there was a Q&A session for IFRS teacher with the IASB Staff on the new and amended IFRSs that would become mandatory in 2013.

Please click for:

• IASB press release (link to IASB website)
• 14 May IASB staff annual event for IFRS Teachers presentation (PDF 2,146k, link to IASB website)

The French standard setter Autorité des normes comptables (ANC) has recently presented a discussion paper Accounting for Emissions Trading Schemes Reflecting Companies’ Business Models that is intended "to inspire the international debate and, as soon as possible, the development of an international accounting standard by the IASB."

The European Union Emissions Trading System (EU ETS) launched in 2005 will move into Phase III in 2013 which will lead to the gradual phasing out of free emission rights and a move towards auctioning of emission rights. Consequently, the questions of whether tradeable permits in emission trading schemes (allowances and credits) are assets and how they should be accounted for need to be addressed. The ANC proposes an accounting approach that builds on the business model of a company as "under IFRS, a uniform measurement of purchased allowances, regardless of the use they are put to, would be irrelevant".

In Australia, the newly introduced Carbon Pricing Mechanism (CPM) is split into phases as well. The fixed price phase in which a carbon tax is levied on certain entities is to run from 1 July 2012 to 30 June 2015. In the following flexible price phase, permits (carbon units) can be traded.

In an agenda paper published by the staff of the Australian Accounting Standards Board (AASB) that is predominently dealing with possible financial reporting implications of the fixed price phase, the staff announces: "The financial reporting implications of the flexible price phase will be considered when the IASB progresses its project on accounting for ETSs." However, the staff also notes: "The AASB has contingency plans in place to provide any necessary financial reporting guidance under Australian Accounting Standards in regard to the flexible price phase, should it be established that a pronouncement from the IASB will not be forthcoming in time to provide a basis for accounting treatments in the flexible price phase."

It is likely that the IASB will be taking up the project on emission trading schemes (ETS) again since during the discussion of the agenda consultation last Wednesday research on emissions trading schemes was named as one of the possible priority projects for the future agenda.

Please click for:

• ANC Discussion Paper in English or French (links to ANC website)
• AASB staff paper (link to AASB website)
• Our summary of the (currently halted) IASB project on ETS
• Notes from the 23 May discussion of the IASB agenda consultation project
• Our sustainability reporting page