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Post-implementation review of IFRS 10, 11 and 12

Date recorded:

Agenda Paper 3

Background

The session in the meeting formed part of phase 1 of PIR of IFRS 10, 11 and 12 and aimed to help the Board identify any matters that entities encountered when implementing and applying these Standards. The materials listed the agenda decisions published in relation to these Standards. The meeting was used to discuss these agenda decisions and other application issues with regards to these Standards.

Discussion

Apart from the application matters set out in the staff paper, the Committee members highlighted the following topics which are commonly found operational practical challenges that are important for the PIR:

  • IFRS 10: Potential voting interest options
  • IFRS 10: Analysis of different shareholders' rights in different periods which may affect the control assessment
  • IFRS 10: Different rights by different classes of shares
  • IFRS 10: Contradiction between IFRS 9 and IFRS 10 (step disposal of a subsidiary)
  • IFRS 11: Accounting for joint operations
  • IFRS 11: Leases and joint operations (Agenda Paper 9 of the March 2019 Committee meeting)
  • IFRS 11: Unit of account in determining the joint arrangements
  • IFRS 11: Unincorporated and incorporated joint ventures
  • IFRS 12: Usefulness of disclosure regarding the unconsolidated structured entities
  • IFRS 12: Disclosure of shareholders' equity and non-controlling interests (example is share-based payments)
  • IFRS 12: Disclosure of composition of a group for investment companies

One Committee member mentioned that the concept of 'control' is used across different Standards including IFRS 10, IFRS 15 and IFRS 16 and whether there is any need to highlight differences. The staff explained the concept of 'control' is to be applied in different ways under different circumstances. The Chair considered it is more appropriate to talk about this issue in the agenda consultation.

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