Two new projects planned for IASB agenda

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27 Jun 2005

At today's meeting of the Standards Advisory Council, IASB research director Wayne Upton said that the IASB staff plans to propose to the Board, for consideration in July, two new projects for the Board's active agenda: Fair value measurement guidance. This project would focus on how to measure fair value.

It would not deal with when a standard should require fair-value measurement, but only how to measure fair value if a standard requires it. The FASB is currently completing work on a similar project, and the IASB's project would build on the FASB's work. The staff will propose that the project lead to an IASB standard rather than amendment of the IASB Framework.
  • Issues arising from IFRIC 3 Emission Rights. This project will consider ways to resolve the 'accounting mismatch' that arises when the intangible asset is measured at historical cost while the related provision is measured at the market value of the allowances needed to settle it. Two possible ways of resolving the 'mismatch' are:
    • Amend IAS 38 Intangible Assets to allow emission allowances that are traded in an active market to be measured at fair value through profit and loss.
    • Amend IAS 39 Financial Instruments to treat the emission allowances as financial instruments to be measured at fair value through profit and loss.
    Either way, an exposure draft is planned for July 2006.
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