IASB issues three new and three revised standards

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31 Mar 2004

The International Accounting Standards Board has issued three new International Financial Reporting Standards – on business combinations, insurance, and asset disposals – and has issued three revised International Accounting Standards, including the finalised macro hedging amendment to IAS 39.

These are briefly noted in the table below.  We will post more detailed summaries shortly.  IASB subscribers will be able to download the new pronouncements from IASB's Website.



IFRS 3 Business Combinations, replacing IAS 22

  • All business combinations are accounted for using the purchase method
  • Pooling of interests is prohibited
  • Goodwill may not be amortised but must be tested for impairment at least annually
  • Post-combination restructuring costs are not accrued as liabilities at the time of the acquisition.
  • Press Release (PDF 60k).

IFRS 4 Insurance Contracts

  • Insurers are exempted from applying the IASB Framework and certain existing IFRSs
  • Catastrophe reserves and equalisation provisions are prohibited
  • Requires a test for the adequacy of recognised insurance liabilities and impairment test for reinsurance assets
  • Insurance liabilities may not be offset against related reinsurance assets
  • Accounting policy changes are restricted
  • New disclosures are required
  • Press Release (PDF 32k).

IFRS 5 Non-current Assets Held for Sale and Discontinued Operations, replacing IAS 35

  • Assets held for sale are measured at the lower of carrying amount and fair value less costs to sell
  • Such assets are not depreciated
  • A major line of business or area of geographical operations must be classified as discontinued when its assets are classified as held for sale
  • Requirements are substantively the same as US FASB Statement 144
  • Press Release (PDF 32k).
Revised IASs

IAS 36 Impairment of Assets

  • The amendments to IAS 36 relate to adoption of IFRS 3 (see press release above) and are not a comprehensive revision of IAS 36

IAS 38 Intangible Assets

  • The amendments to IAS 38 relate to adoption of IFRS 3 (see press release above) and are not a comprehensive revision of IAS 38

IAS 39 Financial Instruments: Recognition and Measurement

  • This amendment incorporates new provisions that permit, in certain cases, fair value hedge accounting for a portfolio hedge of interest rate risk (macro hedging)
  • Press Release (PDF 43k).

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.