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Due Process Oversight Committee Chairman’s report

Date recorded:

Mr Scott Evans reported on the activities of the IFRSF Trustees’ Due Process Oversight Committee.  In particular, he noted that the DPOC had instituted ‘lifecycle’ reviews of projects: that for the Revenue project had been completed in October and that for the forthcoming IFRS on Regulatory Deferral Accounts was expected to be approved at the DPOC meeting on 28 January 2014.

In addition, Mr Evans noted that the IFRS Foundation’s advisory groups supporting XBRL were being restructured and made more appropriate for the integration of XBRL and the technical work of the IASB.

He noted also that the DPOC was involved in reviewing the activities of the IFRS Foundation’s Education Initiative.  He highlighted the risk that anything issued under the Education Initiative would be accompanied by the risk that they would be seen as ‘mandatory or interpretive’ in nature.  The DPOC was aware of this risk and would monitor it closely.

The DPOC was also reviewing the continued existence of some of the long-standing project consultative groups, in particular that they had not out-lived their usefulness.  The staff had noted that consultative groups were often very active at the beginning of a project, but remained useful as a sounding board in its later stages.  DPOC members had attended sessions of five of the IASB’s consultative groups (including Advisory Council, ASAF, Capital Markets and Effects Analysis).  Referring particular to the Effects Analysis Consultative Group, he noted that the DPOC ‘has cautioned that the IASB’s legitimate efforts to be sensitive to the user needs of prudential regulators should not inadvertently expand the scope of effects analysis beyond the constitutional limits of its standard setting responsibilities and should be consistent with the objectives of financial reporting as set out in the Conceptual Framework.

Mr Hoogervorst added to these remarks by noting the DPOC’s concerns around the establishment of the Revenue standard implementation group, noting that the group would not issue any guidance and that nothing the group did or said could be construed as authoritative.

Mr Evans noted that the only item of correspondence addressed in the last reporting period was with BusinessEurope and had been concluded satisfactorily.

Mr Kono queried why the DPOC had cautioned the IASB about the work of the Effects Analysis Consultative Group.  Mr Evans noted that there had been some ‘expansive language’ used at the time the group was established that had caused the DPOC to express caution.

Mr Ian Mackintosh, IASB Vice-Chair, noted that the DPOC’s engagement/ involvement had been ‘thorough but helpful’ and said that the relationship between the DPOC and the IASB and staff was positive and constructive.

There were no further questions for Mr Evans.

 

Mr Kono closed the meeting.

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