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IFRS for Private Entities (formerly IFRS for SMEs)

Date recorded:

The Board continued its redeliberations of an IFRS for Private Entities. At this session the staff sought Board confirmation on disclosures. Nearly all of those recommendations were for further disclosure simplifications, though in a few cases the staff recommended additional disclosures. The staff's recommendations (69 proposals), which were generally consistent with the recommendations of the Working Group, are set out in the attachment to Agenda Paper 6B for the meeting available on the IASB's Website. The Board agreed with the great majority, but not all, of the staff recommendations.

Below are only those proposals (reference to paragraphs in the exposure draft of IFRS for SMEs in brackets) with which the Board disagreed or agreed to with substantive changes.

 

Financial effect of departure from the IFRS for Private Entities (3.4)

The Board disagreed with the proposal to delete the requirement to disclose for each period presented the financial effect of that departure. This only applied if the entity invoked a true and fair override.

 

Information about judgements (8.6)

The Board disagreed with the staff proposal to delete the paragraph. However, to avoid boilerplate disclosure, it was agreed to include guidance on how such disclosures could look in the educational materials.

 

Disclosure of fair values of investment property under the cost model (15.6)

The Board disagreed with the staff proposal to encourage, but not require disclosure of fair value of investment property. It was noted that the staff proposal contained an undue cost or effort exemption. Instead, it was agreed to require disclosure, but to keep the undue cost or effort exemption.

 

Reconciliation of property, plant and equipment (16.29)

The staff proposed simplifications in the reconciliation per class of property, plant and equipment, especially not requiring separate disclosure of exchange differences and additions due to business combinations. The Board agreed with the exception of additions due to business combinations. It was agreed to disclose these additions separately.

 

Disclosures on provisions (20.14)

The staff proposed to delete subparagraphs (e), (f), (g) and (h). The Board agreed to delete (e) and (f), but to keep:

  • (g) indication of the uncertainties about the timing of outflow; and
  • (h) amounts of possible reimbursements (including recognised assets).

 

Disclosures about contingent liabilities (20.15)

The staff proposed to add and undue cost or effort exemption for disclosing contingent liabilities. The Board disagreed with that proposal.

 

Disclosures about defined contribution plans (27.37)

The staff proposed to keep the disclosures in 27.37 on the period expense for defined contribution plans. The Board agreed but decided to delete the requirement to disclose the amount of defined contribution expense that had been included in the cost of an asset.

 

Income tax disclosures (questions 57 and 58)

These questions were skipped as the Board has not yet decided on the recognition and measurement principles for income taxes in the IFRS for Private Entities.

 

Non-adjusting events after the end of the reporting period (32.9/10)

The Board disagreed with the staff proposals to insert the word 'material' in the paragraph on disclosures about each category of non-adjusting events. The staff informed the Board that IAS 10 Events After the Reporting Period included the word 'material'. The Board then proposed that this should possibly be deleted in full IFRS, too, and asked the staff to liaise with the Annual Improvements project team on this issue.

 

Non-current assets held for sale (36.8)

While the Board agreed with the addition of a disclosure requirement for major asset (group of assets and liabilities) disposals, it also agreed to require this disclosure only for binding sale agreements and not also for future disposals where a formal plan exists.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.