IAS 29 — Applicability of the concept of financial capital maintenance defined in constant purchasing power units
The IFRS IC received a request to clarify whether an entity is permitted to use the financial capital maintenance concept defined in terms of constant purchasing power units when the entity’s functional currency is not the currency of a hyperinflationary economy as described in IAS 29 and whether the entity needs to apply IAS 29 to its financial statements prepared under that concept of financial capital maintenance when it falls within the scope of IAS 29.
The Interpretations Committee discussed this issue in September 2013 and tentatively decided not to add it to its agenda.
The project manager informed the Committee that comments have been received on this tentative agenda decision and that one respondent asked for an amendment of IAS 29 to address the problem. The staff believes, however, that this problem is not widespread and the project manager therefore recommended to finalise the agenda decision and asks whether the Committee agrees with this recommendation.
The chairman updated the IFRS IC that this was the main topic of the emerging economies discussion in December 2013. They did not comment on the tentative agenda decision but focussed on the question whether the IASB should pursue a project on price-level accounting. Some but not all Latin American jurisdictions were in favour of such a project; however none of the other jurisdictions supported that view.
There were no comments from Committee members. All supported the staff’s recommendation to finalise the agenda decision.
