Significant proposed modifications to the Code include:

• extending the partner rotation requirements to all key audit partners on an audit of an entity of significant public interest;
• updating requirements related to the provision of non-assurance services, including setting out additional guidance on the provision of tax services to audit clients;
• providing guidance on key audit firm personnel accepting employment with audit clients that are entities of significant public interest; and
• extending the independence requirements to the audits of a wider range of entities of significant public interest.

Comment deadline is 30 April 2007. Click for:

• Exposure Draft (PDF 416k)
• Press Release (PDF 75k)

 

FAS 123R is similar to IFRS 2 Share-based Payment. The amendment modifies rules that were adopted in July 2006. The July rule had required a company to include the entire fair value of stock option grants in the SEC's Summary Compensation Table and the Director Compensation Table in the period in which the options are granted. The revised rule spreads the fair value in those Compensation Tables over the same periods as the company recognises options expense in its financial statements under FAS 123R. Click for SEC Press Release  (PDF 66k).

The cables account for about 90% of the total capacity and mainly affect connections to Japan, Taiwan, Korea, the US and Canada. Operators have implemented contingency plans and rerouted traffic via all other cables still in service. At present, voice call services including IDD calls and roaming calls to most of the countries/territories except for Taiwan have nearly resumed to normal. However, Internet access to overseas websites is still congested. IAS Plus has had less than one-third of the expected number of visitors for the week between Christmas and New Year's Day. Click for HK Government Press Release (PDF 27k).

Click to download the Endorsement Status Report as of 20 December 2006 (PDF 35k). You can always find a link on our EFRAG Page. Currently, the following IASB pronouncements have not yet been endorsed for use in Europe:

• IFRS 8 Operating Segments
• IFRIC 12 Service Concession Arrangements
• IFRIC 11 IFRS 2: Group and Treasury Share Transactions
• IFRIC 10 Interim Financial Reporting and Impairment

The updated Endorsement Status Report reflects EFRAG's recent decision to Recommend IFRIC 10 (PDF 45k) for use in Europe.

The quakes occurred starting at 12:26 GMT on Tuesday 26 December 2006. The server for IAS Plus is located in Hong Kong. The earthquakes and related aftershocks damaged undersea data cables in the Luzon Strait between Hong Kong and Taiwan, disrupting internet links between Hong Kong and much of the world yesterday and continuing today. IAS Plus normally has up time of 99.9% and connect time (time it takes for us to start sending data to you after you access the site) of under 0.8 seconds. The main headline in today's South China Morning Postsays:

Cyberspace chaos leaves region reeling. Net users struggle to cope without their lifelineas providers warn it could take weeks to fix cables damaged by quake.

Update 07:48 GMT 28 December: News reports say that six of the seven main submarine fibre-optic cables serving Hong Kong have been badly damaged and the seventh is functioning with limited capacity. At least eight boats (three from Taiwan and five from Hong Kong) have been dispatched to assess damage and undertake repairs – which reports say may take up to three weeks. Some rerouting of traffic may be possible until repairs are completed.

Written representations are affirmations that auditors request from management, those charged with governance, and others, as part of the audit process. The affirmations relate to the financial statements, including internal control, and the completeness of information made available to the auditor, and specific assertions in the financial statements. The five 'clarity' exposure drafts are:

• ISA 230 (Redrafted), Audit Documentation;
• ISA 540 (Revised and Redrafted), Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related Disclosures;
• ISA 560 (Redrafted), Subsequent Events;
• ISA 610 (Redrafted), The Auditor's Consideration of the Internal Audit Function; and
• ISA 720 (Redrafted), Reading Other Information in Documents Containing Audited Financial Statements.

Proposed ISA 540 is a combination of ISA 540 (Revised), Auditing Accounting Estimates and Related Disclosures (Other Than Those Involving Fair Value Measurements and Disclosures) and ISA 545, Auditing Fair Value Measurements and Disclosures. Comments on the exposure drafts of proposed redrafted ISAs 230, 560, 610 and 720 are requested by 31 March 2007. Comments on the exposure drafts of proposed ISAs 540 (Revised and Redrafted) and 580 (Revised and Redrafted) are requested by 30 April 2007. Click for Press Release (PDF 82k).

The newsletter summarises all of the new and revised Standards and Interpretations in effect for December 2006 year ends and beyond. Here is list of those pronouncements:

Effective for 31 December 2006 year ends
New Standard		IAS Plus newsletter issued
IFRS 6	Exploration for and Evaluation of Mineral Resources	January 2005
Amendments to Standards		IAS Plus newsletter issued
Amendment to IAS 19	Actuarial Gains and Losses, Group Plans and Disclosures	None
Amendment to IAS 21	Net Investment in a Foreign Operation	None
Amendment to IAS 39	Cash Flow Hedge Accounting of Forecast Intragroup Transactions	None
Amendment to IAS 39	The Fair Value Option	July 2005
Amendments to IAS 39 & IFRS 4	Financial Guarantee Contracts	December 2005
New Interpretations		IAS Plus newsletter issued
IFRIC 4	Determining whether an Arrangement Contains a Lease	December 2004
IFRIC 5	Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds	December 2004
IFRIC 6	Liabilities arising from Participation in a Specific Market–Waste Electrical and Electronic Equipment (effective for accounting periods beginning on or after 1 December 2005)	September 2005

Available for early adoption for 31 December 2006 year ends
New Standards		Effective for accounting periods beginning on or after	IAS Plus newsletter issued
IFRS 7	Financial Instruments: Disclosures	1 January 2007	October 2005
IFRS 8	Operating Segments	1 January 2009	December 2006
Amendments to Standards		Effective for accounting periods beginning on or after	IAS Plus newsletter issued
Amendment to IAS 1	Capital Disclosures	1 January 2007	October 2005
Revised Guidance on Implementing IFRS 4		1 January 2007	None
New Interpretations		Effective for accounting periods beginning on or after	IAS Plus newsletter issued
IFRIC 7	Applying the Restatement Approach under IAS 29, Financial Reporting in Hyperinflationary Economies	1 March 2006	December 2005
IFRIC 8	Scope of IFRS 2	1 May 2006	January 2006
IFRIC 9	Reassessment of Embedded Derivatives	1 June 2006	March 2006
IFRIC 10	Interim Financial Reporting and Impairment 1	November 2006	August 2006
IFRIC 11	IFRS 2–Group and Treasury Share Transactions	1 March 2007	December 2006
IFRIC 12	Service Concession Arrangements	1 January 2008	December 2006

You will find all Past IAS Plus Newsletters Here. 

On 30 November 2006, the IASB issued IFRS 8, which replaces IAS 14 Segment Reporting. This newsletter explains the requirements of IFRS 8 and how it differs from IAS 14. IFRS 8 is mandatory for annual financial statements for periods beginning on or after 1 January 2009, although earlier application is permitted. Once IFRS 8 is effective, segment reporting under IFRSs and US Generally Accepted Accounting Principles (SFAS 131) will be converged except for some minor differences. IFRS 8 will expand significantly the requirements for segment information at interim reporting dates. Click for Newsletter (PDF 113k). You will find all Past IAS Plus Newsletters Here. 

In our news story of 12 December 2006 we posted links to various speeches made at the conference. We have now posted a Special Issue of Deloitte's Heads Up Newsletter (PDF 573k, 79 pages) that extracts key insights from this three-day conference attended by more than 2,000 CPAs. Heads Up is published by the National Office Accounting Standards and Communications Group of Deloitte & Touche LLP (United States).

The focus of this 1,236-page text is on the analysis, illustration, and application of IFRSs. The textbook has been written for intermediate and advanced financial reporting courses, at both undergraduate and postgraduate level, and aligns with the knowledge expectations of the accounting profession. Paul's co-authors are Keith Alfredson, former chairman of the Australian Accounting Standards Board (AASB); Ruth Picker, IFRIC member and a technical partner of Ernst & Young; Ken Leo and Jeannie Radford, both of Curtin University of Technology; and Victoria Wise of Victoria University. (ISBN: 9780470808238). Outline of the book:

PART 1 FRAMEWORK

• Chapter 1: The IASB: history, current structure and processes
• Chapter 2: The conceptual Framework of the IASB PART 2 ELEMENTS
• Chapter 3: Contributed equity: capital, reserves and accumulated profits
• Chapter 4: Revenue Recognition
• Chapter 5: Provisions and contingencies
• Chapter 6: Financial instruments
• Chapter 7: Share based payments
• Chapter 8: Income tax
• Chapter 9: Inventories
• Chapter 10: Property, plant and equipment
• Chapter 11: Intangible assets
• Chapter 12: Business combinations
• Chapter 13: Impairment of assets
• Chapter 14: Leases PART 3 DISCLOSURE
• Chapter 15 Principles of disclosure
• Chapter 16: Presentation of financial statements
• Chapter 17: Cash flow statements
• Chapter 18: Segment reporting PART 4 ECONOMIC ENTITIES
• Chapter 19: The nature of economic entities
• Chapter 20: Consolidated financial statements - wholly owned subsidiaries
• Chapter 21: Consolidated financial statements - intragroup transactions
• Chapter 22: Consolidated financial statements - minority interest
• Chapter 23: Consolidated financial statements - indirect ownership interests
• Chapter 24: Consolidated financial statements - foreign currency translation
• Chapter 25: Accounting for investments in associates
• Chapter 26: Interests in joint ventures