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Concerns about implementation of IFRS 8

05 Jan 2010

The United Kingdom Financial Reporting Review Panel (FRRP) has issued a Statement FRRP Highlights the Challenge of Implementing New Segmental Reporting Requirements expressing concern about how companies are reporting the performance of key parts of their business in the light of the introduction of IFRS 8 Operating Segments.

IFRS 8 requires companies to provide an analysis of profit, assets, and liabilities so that investors can see the performance of the principal operations or 'segments'. The FRRP reviewed a sample of 2009 interim accounts and 2008 annual accounts and has asked a number of questions about the implementation of IFRS 8, in particular, where:
  • only one operating segment is reported, but the group appears to be diverse with different businesses or with significant operations in different countries;
  • the operating analysis set out in the narrative report differs from the operating segments in the financial statements;
  • the titles and responsibilities of the directors or executive management team imply an organisational structure which is not reflected in the operating segments; or
  • the commentary in the narrative report focuses on non-IFRS measures whereas the segmental disclosures are based on IFRS amounts.
In its statement, the Panel encourages Boards of Directors to test their initial conclusions about their segmental reporting by considering the following questions:
  1. What are the key operating decisions made in running the business?
  2. Who makes these key operating decisions?
  3. Who are the segment managers (as defined in the standard) and who do they report to?
  4. How are the group's activities reported in the information used by management to review performance and make resource allocation decisions between segments?
  5. Is any proposed aggregation of operating segments into one reportable segment supported by the aggregation criteria in the standard, including consistency with the core principle?
  6. Is the information about reportable segments based on IFRS measures or on an alternative basis?
  7. Have the reported segment amounts been reconciled to the IFRS aggregate amounts?
  8. Do the accounts describe the factors used to identify the reportable segments including the basis on which the company is organised?
Click for Statement FRRP Highlights the Challenge of Implementing New Segmental Reporting Requirements (PDF 36k).


IFRIC (International Financial Reporting Interpretations Committee) (blue) Image

Agenda for 7-8 January 2010 IFRIC meeting

05 Jan 2010

The International Financial Reporting Interpretations Committee (IFRIC) will meet at the IASB's offices in London on Thursday and Friday 7 and 8 January 2010 (morning only on 8 January).

The meeting is open to the public and will be webcast. The tentative agenda is shown below.

Agenda for the IFRIC MeetingThursday and Friday, 7 and 8 January 2010

Thursday 7 January 2010 (10:00-18:15h)

  • Introduction
  • IAS 16 Property, Plant and Equipment – Accounting for production phase stripping costs in the mining industry
  • IFRS 2 Share-based Payment – Vesting and non-vesting conditions
  • Review of Tentative Agenda Decisions published in November 2009 IFRIC Update
    • IAS 38 Intangible Assets – Amortisation method
    • IFRS 2 Share-based Payment – Contingent manner of settlement
    • IAS 27 Consolidated and Separate Financial Statements – Presentation of comparatives when applying the 'pooling of interests' method
    • IAS 27 Consolidated and Separate Financial Statements – Combined Financial Statements and Redefined Reporting Entities
    • IAS 18 Revenue – Receipt of a dividend of treasury shares
    • IFRS 4 Insurance Contracts and IAS 32 Financial Instruments Presentation – Scope issue for investments in REITs
    • IAS 32 Financial Instruments: Presentation – 'Fixed for fixed' condition
  • Annual Improvements – Deliberation of Comments Received
    • IFRS 1 First-time Adoption of IFRSs – Revaluation basis as deemed cost
    • IAS 27 – Impairment of investments in subsidiaries, jointly controlled entities and associates in the separate financial statements of the investor
    • IFRS 3 Business Combinations – Measurement of non-controlling interests
    • IFRS 3 – Transition requirements for contingent consideration from a business combination that occurred before the effective date of the revised IFRS
    • IFRS 7 Financial Instruments: Disclosures – Disclosures about the nature and extent of risks arising from financial instruments
    • IAS 28 Investments in Associates – Partial use of fair value for measurement of associates
    • IAS 39 Financial Instruments: Recognition and Measurement – Bifurcation of embedded foreign currency derivative
    • IAS 39 – Application of the fair value option
    • IAS 34 Interim Financial Reporting – Significant events and transactions
Friday 8 January 2010 (09:00-12:30h)
  • Staff Recommendations for Tentative Agenda Decision
    • IFRS 8 Operating Segments and IAS 36 Impairment of Assets – Transition provisions for IFRS 8 amendment
    • IAS 21 The Effects of changes in Foreign Exchange Rates – Determination of functional currency of investment holding company
    • IAS 32 Financial Instruments: Presentation – Debt/equity classification of instruments with obligation to deliver cash at the discretion of shareholders
    • IFRS 1 First-time adoption of International Financial Reporting Standards – Accounting for costs included in self-constructed assets on transition
    • IAS 39 Financial Instruments Recognition and Measurement – Unit of account for forward contracts with volumetric optionality
  • Administrative Session – IFRIC work in progress
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Stay Tuned Online – IFRS and UK GAAP update

08 Sep 2009

The Deloitte London IFRS Centre of Excellence is running a series of hour-long Internet-based financial reporting updates, aimed at helping finance teams keep up to speed with IFRSs and other financial reporting issues.

Each update lasts no more than an hour, and sessions are normally held three times a year, approximately at the end of March, July, and November. We intend to make a recording of each session available on IAS Plus for a period of at least four months from the date of the presentation. The 30 July 2009 Stay Tuned Online IFRS and UK GAAP Update archive is now available, covering the following topics:
  • IFRS for Small and Medium-sized Entities
  • ED 2009/5 Fair-value Measurement
  • DP2009/2 Credit Risk in Liability Measurement
  • IAS 39 The Sequel
  • ED 2009/6 Management Commentary
  • FRS 30 Heritage Assets and other UK developments
  • Other IFRS Developments
To access the recording Click Here (35.4mb WMV). When you click on this link, what happens will depend on how your computer is configured. The webcast may open directly in your media player, or you may be asked whether you want to open or save the file, or you may only be given a choice to save the file. You can play a saved file by clicking on it. There's a permanent link on our UK Country Page.


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November 2006 edition of EITF Roundup

02 May 2006

We have posted the (PDF 134k), which provides an overview of the issues discussed, consensuses reached, and administrative matters discussed at the 16 November 2006 meeting of FASB's Emerging Issues Task Force.

You will find past issues Here. Issues covered in the September 2006 edition include:
  • Issue No. 06-6, Debtor's Accounting for a Modification (or Exchange) of Convertible Debt Instruments
  • Issue No. 06-7, Issuer's Accounting for a Previously Bifurcated Conversion Option in a Convertible Debt Instrument When the Conversion Option No Longer Meets the Bifurcation Criteria in FASB Statement No. 133, Accounting for Derivative Instruments and Hedging Activities
  • Issue No. 06-8, Application of the Assessment of a Buyer's Continuing Investment Under FASB Statement No. 66, Sales of Real Estate, for Sales of Condominiums
  • Issue No. 06-9, Reporting a Change in (or Elimination of) a Previously Existing Difference Between the Fiscal Year-End of a Parent Company and That of a Consolidated Entity or Between the Reporting Period of an Investor and That of an Equity Method Investee
  • Issue No. 06-10, Accounting for Deferred Compensation and Postretirement Benefit Aspects of Collateral Assignment Split-Dollar Life Insurance Arrangements Issue No. 06-11, Accounting for Income Tax Benefits of Dividends on Share-Based Payment Awards
  • Issue No. 06-12, Application of AICPA Audit and Accounting Guide, Brokers and Dealers in Securities, to Entities That Engage in Commodity Trading Activities and Related Issues
IFAC (International Federation of Accountants) (lt gray) Image

IAESB seeks comments on draft strategic plan

02 May 2006

The International Accounting Education Standards Board (IAESB) is seeking comments on an exposure draft of its Strategic and Operational Plan for the Period 2007-2009 (PDF 98k).

The IAESB proposes to undertake three high priority activities, beginning in 2007. These are:
  • Conducting a fundamental review of the Framework for International Education Statements (IESs), considering developments in accounting education and the accountancy profession as a whole since this was first written;
  • Developing a benchmarking methodology to help IFAC members and others achieve the measurable implementation of IESs; and
  • Reviewing existing IESs to determine areas where the clarity of standards could be improved and/or additional guidance most usefully developed.
Comments on the exposure draft are requested by 28 February 2007. Click for Press Release (PDF 82k).

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