The IASB discussed the current status of the project to revise IAS 20 Accounting for Government Grants and Disclosure of Government Assistance. In addition, they discussed a request from the national standard-setter in New Zealand that IAS 20 be withdrawn.

Although some Board members thought that withdrawing IAS 20 would be a step in the right direction, the majority thought that the accounting vacuum that it would leave behind was not desirable. Nor was the accounting for grants in IAS 40 Agriculture thought to be necessarily superior.

The Board noted that certain issues related to recognising and measuring obligations under grants with conditions attached are similar to issues related to recognising and measuring provisions under IAS 37. Because the Board is currently reconsidering IAS 37 as part of the Business Combinations Phase II project, it decided to defer work on the IAS 20 project pending final decisions on revision of IAS 37, which are expected in mid-2007 (8 in favour; 6 opposed). This decision effectively means that work on accounting for emission trading schemes will also be deferred.