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IASB releases agenda for its January meeting

17 Jan, 2012

The IASB will be holding its January 2012 meeting on 25-27 January 2012, much of it a joint meeting with the FASB.

You can access the agenda on our January 2012 IASB meeting page.  We will also post Deloitte observer notes on this page as they are available.

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FRC issues an update responding to country and currency risk in financial reporting

17 Jan, 2012

The UK Financial Reporting Council (FRC) has issued An Update to Directors of Listed Companies: Responding to increased country and currency risk in financial reports.

The Update was issued due the current economic uncertainties in numerous countries. The Update aims to provide issues to UK listed companies that may occur when responding to the increasing country and currency risk when filing their annual and semi-annual financial reports. The Update notes the following:

The issues Directors could consider include, where relevant:

  • The company's exposure to country risk, direct or to the extent practical indirect, through financial instruments but also in terms of exposure to trading counterparties (customers and suppliers);
  • The impact of austerity measures being adopted in a number of countries on the company's forecasts, impairment testing, going concern considerations, etc.;
  • Possible consequences of currency events that are not factored into forecasts but may impact reported exposures and sensitivity testing of impairment or going concern considerations; and
  • A post balance sheet date event requiring enhanced disclosures to avoid misleading investors. [Footnote omitted]

The Update also suggests that additional guidance should be considered, such as the ESMA's statement Sovereign Debt in IFRS Financial Statements (see our earlier story).

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Deloitte publication update

16 Jan, 2012

A reminder that you can access all the latest IFRS related Deloitte newsletters on the 'Publications' tab on the home page, including the latest edition of our Model financial statements.

The most recent publications include:

The page also highlights that Deloitte's 2011 Model Financial statements that reflect the early application of new and revised Standards are now available. The model financial statements illustrate the impact of a number of new and revised Standards and Interpretations that are mandatorily effective on 1 January 2011 and the impact of the early application of new and revised Standards that are not yet mandatorily effective on 1 January 2011 (e.g. IFRS 9 Financial Instruments, IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interests in Other Entities and amendments to IAS 1, IAS 12, and IAS 19). They also contain additional disclosures that are considered to be best practice, particularly where such disclosures are included in illustrative examples provided with a specific Standard.

Click for IFRS Model Financial Statements for 2011 including early adoption.

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Notes from the IFRS Foundation Trustees meeting

12 Jan, 2012

The IFRS Foundation Trustees held a meeting in Singapore on 12 January 2012.

We have posted Deloitte observer notes from the meeting (click through for direct access to the notes):

Thursday, 12 January 2012

Click here to go to the preliminary and unofficial notes taken by Deloitte observers for the entire meeting.

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IAASB feedback statement on disclosure consultation

11 Jan, 2012

The International Auditing and Assurance Standards Board (IAASB) has released a 'Feedback Statement' on the responses to its January 2011 Discussion Paper 'The Evolving Nature of Financial Reporting: Disclosure and Its Audit Implications'. The Discussion Paper solicited views and perspectives of different stakeholder groups on the challenges arising as financial reporting continues to evolve to meet the changing needs of users.

The Feedback Statement presents a summary of the range of views on some of the more significant challenges faced by participants across the entire financial reporting supply chain, including the impact of trends in financial reporting, applying materiality to disclosures, evaluating misstatements generated by disclosures, the availability of audit evidence to support disclosures, and work effort.

To address some of the issues identified respondents have called for more auditing guidance in certain identified areas. However, the majority of the respondents were of the view that some of the more important issues could not be addressed by the IAASB on its own, but would require international collaboration and cooperation, particularly with both the accounting standard setters—including the International Accounting Standards Board (IASB) and US Financial Accounting Standards Board (FASB), and regulators.

The need for a 'Disclosure Framework' is a recurring theme in recent times. For instance, our comment letter (PDF 126k) on the IASB's Agenda Consultation noted the "development of a clear framework for disclosures in financial statements is critical and urgent".

Click for IAASB press release (link to IFAC website).

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New ICAEW website on auditing

11 Jan, 2012

The Institute of Chartered Accountants of England and Wales (ICAEW) has launched a new website dedicated to auditing and its possible reform.

The website contains high-level information about the nature and value of auditing, possible options for change, details of current reviews, and a question and answer section.

The website can be accessed at www.trueandfair.org.uk.

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IFRS Advisory Council membership update

10 Jan, 2012

The Trustees of the IFRS Foundation have announced the appointments and reappointments to the IFRS Advisory Council for memberships that ended 31 December 2011.

The new terms begun on 1 January 2012 and are between one and three years to enchance continuity.

In addition, Paul Cherry has been reappointed for another two years as Chairman of the Advisory Council. Patrice Marteau has been reappointed for one year and Charles Macek has been reappointed for three years, both as Vice-Chairmen of the Advisory Council.

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AOSSG survey on Islamic accounting

10 Jan, 2012

The Islamic Finance Working Group of the Asian-Oceanian Standard Setters Group (AOSSG) has issued a survey on Islamic accounting.

The purpose of the survey is to highlight the importance of current Islamic accounting and the need to have the IASB consider Islamic financial transactions when discussing ongoing and future projects.

The survey was run between 1 July and 15 October 2011. The survey was sent to national standard-setters in Asia-Oceania and the National Standards Setters (NSS) members. Responses from 24 participating standard-setters were used in developing this report.

Several main conclusions from the survey are:

  • entities using Islamic accounting are not subject to a common set of accounting standards.
  • ’Islamic accounting standards‘does not imply there is a consistent set of standards used globally. Instead, the term implies that there are different sets of religiously-influenced standards, the different regulations can treat similar transactions with significantly different results.
  • an overwhelming majority of respondents believed there should not be a separate Islamic accounting standards because it was likely it would be incompatible with IFRS convergence.

Based off the survey results, AOSSG Islamic Finance Working Group may need to expand its work to jurisdictions without their own identifiable accounting standard-setters and continue their efforts to promote consistent reporting in jurisdictions with a significant Islamic finance presence.

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Outcomes from recent Capital Markets Advisory Committee meeting

09 Jan, 2012

The IASB has released a summary of the Capital Markets Advisory Committee (CMAC) meeting which was held in London on 12 October 2011. The CMAC was previously known as the Analyst Representative Group (ARG) and is a group of professional financial analysts who regularly meet with members of the IASB to provide the views of professional investors on financial reporting issues.

The topics discussed at the meeting included:

  • XBRL. The CMAC considered the IFRS taxonomy, custom tags and the Thomson Reuters taxonomy model
  • Risk free rate of return. There was a general view among the participants that the determination of the risk free rate was not the responsibility of the IASB, discussion also included when 'synthesised' risk free rates may be appropriate (e.g. entities operating in the Eurozone or multi-nationals)
  • Impairment of financial instruments. The CMAC considered the IASB's current impairment model ('three bucket approach') and considered matters such as 'day one losses', information needs, and the use of expected values
  • Transition disclosures. The CMAC discussed disclosures made when an IFRS is issued but is not yet mandatory, a preference for IFRS 1 type disclosures when a new standard is applied for the first time, and related matters
  • Other. The CMAC discussed the usefulness of project-specific case studies for accounting proposals, and the IASB's agenda consultation.

Click for more information (link to IASB website).

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Agenda for January 2012 IFRS Interpretations Committee meeting

07 Jan, 2012

The IFRS Interpretations Committee will meet at the IASB's offices in London on Tuesday and Wednesday 17 and 18 January 2012.

The meeting is open to the public and will be webcast. The tentative agenda is shown on our meeting note page for the meeting.

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