Latest New Zealand Accounting Alert posted

30 Sep 2004

The (PDF 152k) summarises recent exposure drafts issued by the Financial Reporting Standards Board as part of the convergence process with IFRSs.

Also included is an overview of a discussion paper Preliminary Views on Accounting Standards for Small and Medium-sized Entities and a list of the latest New Zealand Pending Accounting Standards. Click for Past Issues.

iGAAP 2005 Financial Instruments: IASs 32/39

30 Sep 2004

Deloitte has published iGAAP 2005 Financial Instruments: IAS 32 and 39 Explained, an authoritative guide to applying those two standards.

The publication is relevant to current IAS reporters that are adopting both of the revised standards, as well for first time adopters of IFRSs. The publication includes:
  • Classification of financial assets and liabilities, derivatives and embedded derivatives, measurement, derecognition, extensive guidance on hedge accounting, as well as specific guidance on how to apply both of these complex standards if you are a first time reporter using IFRS.
  • Detailed application guidance, illustrative examples, and interpretations of the standards.
iGAAP 2005 Financial Instruments: IAS 32 and 39 Explained can be purchased through CCH Online or by phone at +44 (0) 870 777 2906. iGAAP 2005 Financial Statements for UK Listed Groups is also available, and the complete iGAAP 2005 Manual will be available from November 2004.

Latest Global Offerings Services newsletter

30 Sep 2004

We have posted the September 2004 edition of Deloitte's (PDF 138k).

This newsletter is published by Deloitte's Global Offerings Services group, which is a global team of practitioners assisting non-US companies and non-US practice office engagement teams in applying US and international accounting standards (that is, US GAAP and IFRSs) and in complying with the SEC's financial reporting rules. You can find past issues Here.

Now available – IAS 32 and IAS 39 modules

30 Sep 2004

We are pleased to make available without charge the first of three Deloitte e-learning modules on IAS 32 Financial Instruments: Presentation and Disclosure and IAS 39 Financial Instruments: Recognition and Measurement.

In this module, you will learn about the content of IASs 32 and 39 and how to apply those standards in practice. Several case studies are included. This module reflects both the December 2003 revisions to IAS 32 and IAS 39 and the March 2004 macro hedging revisions to IAS 39. Subsequent to those revisions, the IASB has issued four exposure drafts of further changes to IAS 39 as well as a new financial instruments disclosure exposure draft that would replace and expand the disclosures now in IAS 32. The e-learning module does not address these proposed changes.

EC's revised IAS 39 "carve-out" proposal

29 Sep 2004

The European Commission has posted to its Internal Markets Website its revised proposal to adopt IAS 39 for use in Europe with two significant modifications that would (1) remove the IAS 39 fair value option as it applies to liabilities, and (2) facilitate the use of fair value hedge accounting for the interest rate hedges for core deposits on a portfolio basis.

The proposal will be considered by the EC's Accounting Regulatory Committee at a meeting on 1 October 2004. Click to download:

IPSASs for governments in Europe?

29 Sep 2004

International Public Sector Accounting Standards (IPSASs) are essential to the development and strengthening of financial reporting by governments – that was the conclusion of a high-level conference organised jointly by the European Commission and the European Federation of Accountants (FEE).

IPSASs are developed by the Public Sector Committee of IFAC and are based, to the extent appropriate on IFRSs. Click for (PDF 121k).

SEC proposes voluntary XBRL filings

28 Sep 2004

As part of its initiative to assess the benefits of tagged data and its potential for improving the timeliness, accuracy, and analysis of financial disclosures by public companies, the US Securities and Exchange Commission has proposed to establish a voluntary program allowing registrants to file supplemental financial information using eXtensible Business Reporting Language (XBRL).

The program would begin with the 2004 calendar year-end reporting season. In addition to domestic issuers, the voluntary program is available to foreign private issuers that otherwise file financial information prepared in accordance with US GAAP. The Commission also issued a concept release on the benefits and implications of tagging data for filers, investors, the Commission, and other market participants, and on the suitability of the XBRL format. Click for:

Later this week – IAS 32 and IAS 39 modules

28 Sep 2004

The first of the three e-learning modules on IAS 32 Financial Instruments: Presentation and Disclosure and IAS 39 Financial Instruments: Recognition and Measurement will be released later this week.

Watch for the announcement on IASPlus.

EFRAG letter to EC on IAS 39 "carve-outs"

28 Sep 2004

The European Financial Reporting Advisory Group (EFRAG) has responded to the request of the European Commission for technical input on the "carve-outs" proposed by the EC in relation to IAS 39 Financial Instruments: Recognition and Measurement.

The "carve-outs" would:
  • remove the IAS 39 fair value option as it applies to liabilities, and
  • facilitate the use of fair value hedge accounting for the interest rate hedges for core deposits on a portfolio basis.
EFRAG's Letter (PDF 71k) notes, among other things:

Many of the comments received referred to significant side effects of the carve-out, which were also noted by members of EFRAG.

In relation to the carve-out of the fair value option for liabilities the concerns are that the carve-out will create artificial volatility for many entities in Europe and the effect may be serious for those entities and countries affected. We have in the appendix explained these issues more fully, but we can mention the cases of economically or contractually linked or matched financial assets and liabilities where artificial volatility is introduced if assets and related liabilities are not accounted for on the same basis. Examples are unit linked instruments and the Danish mortgage institutions.

In relation to hedge accounting the effect of the carve-outs is not just to allow fair value hedging of core deposits on a portfolio basis but to extend the range of items that can be designated as hedged items and to relax the effectiveness test requirements for all hedges. The effects of their relaxation are significant.

In practice the tightening of the provisions in relation to the fair value option prevents entities from using certain sensible accounting practices that they would be able to use under the full IAS 39. On the other hand the relaxation of the effectiveness test for hedging transactions will allow entities to apply accounting that the full IAS 39 would not.

Web-based technical update on IASs 24 and 38

28 Sep 2004

The Deloitte London IFRS Centre of Excellence is running a monthly series of hour-long Internet-based IFRS technical updates, focusing on the most important international accounting standards and how they will affect UK companies.

The fifth Webcast was run on 23 September 2004 and covered IAS 24 Related Party Disclosures and IAS 38 Intangible Assets. To access the recording Click Here. The recording of each session will be available on this website for a period of at least 3 to 4 weeks from the date of the presentation. Links to past sessions may be found on our United Kingdom Page. The recording is no longer available online.

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