October

Reminder about upcoming comment deadline

04 Oct 2007

We remind you that the deadline is Friday, 5 October 2007, for responding to IFRIC Draft Interpretation D21 – Real Estate Sales.

IFRIC D21 addresses accounting by real estate developers for sales of units, such as apartments or houses, 'off plan', that is, before construction is complete. At present, some real estate developers record revenue only when they have handed over the completed unit to the buyer, while others record revenue earlier, as construction progresses, by reference to the stage of completion of the development. IFRIC D21 proposes that revenue should be recorded as construction progresses only if the developer is providing construction services, rather than selling goods (completed real estate units). It proposes features that indicate that the seller is providing construction services. In many countries, these features tend currently not to be present in typical off plan sale agreements.

South Africa adopts IASB's SME proposal as GAAP for SMEs

04 Oct 2007

The Accounting Practices Board (APB) of the South African Institute of Chartered Accountants (SAICA) has adopted the IASB's proposed International Financial Reporting Standard for SMEs as a final Statement of Generally Accepted Accounting Practice (GAAP) for Small and Medium-sized Entities (SMEs).

The APB's reason for doing so is that full South African GAAP is converged with full IFRSs, and many South African SMEs have found these requirements burdensome and too complex for their needs. A recent change in South African company law has made provision for differential reporting for 'limited interest companies' (SMEs) from full South African GAAP if they want it.

 

Entities eligible to use the new Statement of GAAP for SMEs

  • Companies: The Statement of GAAP for SMEs may be applied by 'limited interest companies', as defined in the Corporate Laws Amendment Act of 2006 (that is, they are not 'widely held'), if they do not have public accountability (that is, not listed and not a financial institution). Alternatively, the company may choose to apply full South African Statements of GAAP or full IFRSs.
  • Entities other than companies:
    • If the law or a regulation requires an entity to comply with a specific financial reporting framework other than South African Statements of GAAP, the entity is not eligible to use the Statement of GAAP for SMEs.
    • In all other cases, if the entity does not have public accountability, it should assess whether it is appropriate to apply the Statement of GAAP for SMEs.

 

How to describe the basis of presentation

  • Companies and other entities using the Statement of GAAP for SMEs must say so in the notes to financial statements. The audit report should do likewise. Reference should not be made to an IFRS for SMEs.

 

Effective date:

  • Companies: The Statement may be applied to annual financial statements for financial years ending on or after 31 December 2005 that are issued on or after 1 October 2007.
  • Entities other than companies: The Statement may be applied to annual financial statements that are issued on or after 1 October 2007.

 

Click for more information

There are currently visitors connected to www.iasplus.com

03 Oct 2007

We are now able to track how many visitors are connected to our website at a point in time.

If you're curious, this number will always be available at the Bottom of Our Home Page, along with the cumulative number of visitors and maps of the locations of the last 500 and last 100 visitors.

Report from last week's meeting of IASB and ASBJ

03 Oct 2007

The IASB met with representatives of the Accounting Standards Board of Japan (ASBJ) in London on 27 and 28 September 2007 to discuss progress on convergence of Japanese GAAP and IFRSs.

The discussions included a review of short-term convergence projects, where the goal is to eliminate major differences by the end of 2008, as well as other major projects including segment reporting, intangible assets, special purpose entities and business combinations where the goal is to eliminate major differences by June 2011. In addition, the representatives of the boards exchanged views on the current status of their work on consolidation, liabilities and equity, and revenue recognition. Click for IASB News Release (PDF 48k).

Our table of use of IFRSs by jurisdiction is expanded

02 Oct 2007

We have expanded our Table that Shows the Use of IFRSs by Jurisdiction for domestic listed companies and for domestic unlisted companies.

The expansion includes a column that indicates whether the audit report and basis of presentation note refer to IFRSs without qualification or whether they refer to IFRSs as adopted by the local jurisdiction or to local GAAP. We have also added grand totals of the various columns:

Grand Totals for Listed Companies

Information, to the best of our knowledge, for 140 jurisdictions:

  • IFRSs not permitted — 32 jurisdictions
  • IFRSs permitted — 26 jurisdictions
  • IFRSs required for some companies — 3 jurisdictions
  • IFRSs required for all companies — 79 jurisdictions

Of the 108 jurisdictions (26 + 3 + 79) that permit or require IFRSs:

  • In 73 jurisdictions the audit report refers to conformity with IFRSs
  • In 32 jurisdictions the audit report refers to local GAAP or to IFRSs as adopted in the jurisdiction
  • In 1 jurisdiction the audit report for some companies refers to local GAAP and for other companies it refers to IFRSs
  • For 2 jurisdictions we do not have this information

Grand Totals for Unlsted Companies

  • IFRSs not permitted — 41 jurisdictions
  • IFRSs permitted — 40 jurisdictions
  • IFRSs required for some companies — 17 jurisdictions
  • IFRSs required for all companies — 24 jurisdictions

IAS 1 (Revised 2007) compliance checklist

02 Oct 2007

We have published an IAS 1 (Revised 2007) Compliance Checklist.

IAS 1 (Revised 2007) Presentation of Financial Statements was issued on 6 September 2007 and is effective for annual periods beginning on or after 1 January 2009, with early application permitted. There is a permanent link to this and related Deloitte publications on our Model Financial Statements Page.

IAS Plus Newsletter on revisions to IAS 1

02 Oct 2007

Deloitte's IFRS Global Office has published a special edition Presentation of Financial Statements.

The revisions to IAS 1, which the IASB published on 6 September 2007, represent the first step in the Board's comprehensive project on reporting financial information. The main changes from the previous version of IAS 1 are to require that an entity must:
  • Present all non-owner changes in equity (that is, 'comprehensive income') either in one statement of comprehensive income or in two statements (a separate income statement and a statement of comprehensive income). Components of comprehensive income may not be presented in the statement of changes in equity.
  • Present a statement of financial position (balance sheet) as at the beginning of the earliest comparative period in a complete set of financial statements when the entity applies an accounting policy retrospectively or makes a retrospective restatement.
  • Disclose income tax relating to each component of other comprehensive income.
  • Disclose reclassification adjustments relating to components of other comprehensive income.
The revised Standard is effective for annual periods beginning on or after 1 January 2009, with early application permitted. You will find all Past IAS Plus Newsletters Here

IAASB invites comments on strategy for 2009-2011

02 Oct 2007

The International Auditing and Assurance Standards Board (IAASB) is seeking comments on its proposed future technical strategy.

The strategy, when finalised, will form the basis for the IAASB's work program for 2009 to 2011. Comments are requested by 30 November 2007. Click to download: The IAASB has also has determined that its complete set of clarified International Standards on Auditing (ISAs) will be effective for audits of financial statements for periods beginning on or after 15 December 2009. Announcing this date will allow standard setters, regulators, and auditors to plan for the adoption and implementation of the standards. Click to download: You will find more information on IAASB's Home Page www.iaasb.org.

 

Overview and impact of the IASB's insurance DP in Denmark

01 Oct 2007

Deloitte in Denmark has published a booklet about the IASB's Discussion Paper (DP) on Insurance Contracts.

The DP is the first step in the IASB's project to develop a comprehensive global financial reporting standard for accounting for all insurance contracts from the perspective of the insurer. The publication (which is in the Danish language) provides an overview of the DP and examines the expected impact on Danish life and non-life insurance companies, including numerical examples. Click to  Download the Deloitte Denmark Publication (PDF 1,082k).

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.