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Key provisions of Preface exposure draft

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09 Nov 2001

We have posted a summary of the key provisions of the Proposed Preface to IFRS.

 

Key provisions of the proposed Preface

We have maintained these proposals here for historical interest. Please note that these proposals differ in a few respects from the IASB's conclusions in its final Preface to IFRS.

  • IASB Standards will be known as International Financial Reporting Standards (IFRS).
  • IFRS will include IAS issued by IASC from 1973-2000.
  • IFRS will apply to the general purpose financial statements and other financial reporting of all profit-oriented entities regardless of their legal form (corporate, mutual, cooperative, etc.).
  • Other financial reporting includes information provided outside financial statements that assists in the interpretation of a complete set of financial statements or improves users' ability to make efficient economic decisions.
  • IFRS will apply to individual company and consolidated financial statements.
  • A complete set of financial statements includes a balance sheet, an income statement, a statement showing either all changes in equity or changes in equity other than those arising from investments by and distributions to owners, a cash flow statement, and accounting policies and explanatory notes.
  • If an IFRS allows both a 'benchmark' and an 'allowed alternative' treatment, financial statements may be described as conforming to IFRS whichever treatment is followed.
  • IAS issued by IASC distinguished between main principles (printed in bold typeface) and explanation of the main principles (set in plain typeface). IFRS issued by IASB will not make such a distinction.
  • The provision of IAS 1 paragraph 11 that conformity with IAS requires compliance with every applicable IAS and Interpretation requires compliance with all IFRS as well.
  • Due process steps for a Standard will normally include (* means required by IASB Constitution):
    • Staff work to identify and study the issues and existing national standards and practices
    • IASB consults with SAC*
    • IASB forms an advisory group
    • IASB publishes a discussion document for comment
    • IASB considers comments received on the discussion document
    • IASB publishes an exposure draft with at least 8 affirmative votes* (ED will include dissenting opinions and basis for conclusions)
    • IASB considers comments received on the exposure draft
    • IASB considers the desirability of holding a public hearing and of conducting field tests
    • IASB approves the final Standard with at least 8 affirmative votes* (the Standard will include dissenting opinions and basis for conclusions)
  • Interpretations of IFRS will be developed by the International Financial Reporting Interpretations Committee (IFRIC) for approval by IASB
  • Due process steps for an Interpretation will normally include (* means required by IASB Constitution):
    • Staff work to identify and study the issues and existing national standards and practices
    • IFRIC studies national standards and practices
    • IFRIC publishes a draft Interpretation for comment if no more than 3 IFRIC members have voted against the proposal*
    • IFRIC considers comments received on the draft Interpretation within a reasonable period of time
    • IFRIC approves the final Interpretation if no more than 3 IFRIC members have voted against the proposal* and submits it to IASB
    • IASB approves the final Interpretation by at least 8 affirmative votes of IASB*
  • IASB and IFRIC meetings will be open to public observation
  • Each IFRS and Interpretation will set out its own effective date and transition provisions
  • English is the official language of IASB discussion documents, exposure drafts, IFRS, and Interpretations. IASB may approve translations if the process assures the quality of the translation, and IASB may license other translations.

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.