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IFRIC update

Date recorded:

The implementation director highlighted the main points of the September 2013 IFRIC Update (Deloitte observer nots from the meeting are available here).

He drew special attention to three IFRS 2 Share-based Payment issues the IFRS IC discussed.

The first is the measurement of cash-settled share-based payment transactions that include a performance condition. The IFRS IC recommended addressing this item in the Annual Improvements Cycle 2012-2014.

The second is on the accounting for share-based payment transactions in which the manner of settlement is contingent on a future event that is outside the control of both the entity and the counterparty. He pointed out that there is diversity in practice which the Interpretations Committee proposes to address through a narrow-scope amendment.

The third issue is on the price difference between the institutional offer price and the retail offer price for shares in an initial public offering which will be dealt by the IFRS IC with a tentative agenda decision.

He recommended dealing with the first and second issue in one narrow-scope amendment rather than amending IFRS 2 twice.

He also explained that there is one item on IFRS 5 Non-current Assets Held for Sale and Discontinued Operations that the Committee discussed. This was on the write-down of a disposal group and reversal of impairment losses relating to goodwill recognised for a disposal group. The IFRS IC noted that there are other IFRS 5 issues that the IASB had previously considered but not addressed and therefore asked staff to consider all issues together and identify whether an amendment is needed.

One Board member supported the approach to group several smaller amendments for the same Standard into one bigger amendment.

Another Board member asked the implementation director whether there were intentions to comprehensively review IFRS 2 as there are very many issues with the Standard.

The implementation director said that various sides have reported problems with IFRS 2 and therefore it is on the agenda; however it was decided to prioritise other Standards which were deemed more urgent.

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