May

Special IASB meeting on 5 June

19 May 2009

The IASB will hold a special Board meeting at its offices in London on Friday 5 June 2009 starting at 13:00 (London time) and running between two and two-and-a-half hours.

Some Board members will be taking part via conference call. An audio webcast will be available via the internet. The agenda topic for the meeting is:

This is an education session and the Board will not be asked to make decisions. The Board's regular June meeting will be held 15-19 June 2009. The Board will meet with the Standards Advisory Council on 22-23 June 2009 in London.

UK Parliament Committee defends 'mark-to-market'

16 May 2009

A report from the United Kingdom House of Commons Treasury Committee has concluded that bad decisions at banks – not accounting rules – caused the global financial crisis.

The report, titled Banking Crisis: Reforming Corporate Governance and Pay in the City, makes the following points, among others:

Fair value accounting

Fair value accounting has led to banks publishing some very dispiriting financial results, but this is because the news itself has been bad, not the way in which it has been presented. The uncomfortable truth for banks is that market participants had overinflated asset prices which have subsequently corrected dramatically. Fair value accounting has actually exposed this correction, and done so more quickly than an alternative method would have done. Important features of accounting frameworks are that they encourage transparency and consistency across firms and asset classes. But it is a bridge too far to expect them to also lead to intelligent decision-making. We do not consider fair value accounting to be a suitable scapegoat for the hubris, poor risk controls and bad decisions of the banking sector.

EU modifications of IFRSs

We regret the power of the European Commission to pick and choose which international accounting standards should be implemented in the EU and call on the Treasury to consider the impact of the Commission's powers on the objective of establishing a single global set of accounting standards.

Click for:

Roundtables on consolidation and derecognition

15 May 2009

The IASB has announced details of its planned North American roundtables on consolidation and derecognition, to be held in Toronto, 1-2 June 2009:

  • Location: Hyatt Regency Toronto on King (Regency D/E), 370 King Street West, Toronto, Ontario M5V 1J9, Canada
  • Times:
    • Monday 1 June – morning (09:00 to 12:15): Derecognition education session
    • Monday 1 June – afternoon (13.30 to 16:45): Joint derecognition and consolidation round table
    • Tuesday 2 June – morning (09:00 to 12:15): Consolidation-only round table
The IASB will hold similar roundtables:
  • 8 and 9 June 2009 in Tokyo
  • 15 and 16 June 2009 in London
Although the roundtables will not be webcast live, audio recordings will be available on IASB's website shortly after the roundtables.

 

 

Role of national standard setters

14 May 2009

Gilbert Gelard IASB Board member Gilbert Gelard spoke about National Standard Setters: A New Role in a Globalising World at the London School of Economics on 11 May 2009. Mr Gelard discussed the importance of global accounting standards, European adoption of IFRSs, 'adopt versus adapt', and how the spreading of IFRSs throughout the world has dramatically changed the national standard setters 'scene'.

Click to Download Mr Gelard's Remarks (PDF 43k), which are posted on IAS Plus with his kind permission. Here is an excerpt:

If standard setters have a role to play in this new world, they should be careful on how to use scarce resources. There is also one thing they are tempted to do and should refrain from doing: they should not try to second-guess nor to interpret IFRSs. The argument that something is so specific to their jurisdiction that the correct solution to an issue can only be developed locally appears to be ill-founded in almost all cases. An apparently purely local question can and should always be upgraded to a more general issue likely to be encountered somewhere else in the world. The interpretative issues should be sent for examination to IFRIC, which is the competent body. The only thing a standard setter should be allowed to issue regarding IFRS is guidance and educational material, provided this guidance is not an interpretation by another name. Different local flavours of IFRSs should be avoided at all costs. The memorandums of understanding proposed by the IASB to standard setters is quite specific on the question of interpretations.

 

Taiwan will move to IFRSs in 2013

13 May 2009

On 14 May 2009, the Financial Supervisory Commission (FSC) of Taiwan announced its roadmap for the full adoption of IFRSs in Taiwan.

Taiwan has adopted a plan to adopt IFRSs in two phases. Phase I companies (listed companies and financial institutions supervised by the FSC, except for credit cooperatives, credit card companies, and insurance intermediaries) will be required to adopt Taiwan-IFRS starting 2013. Early adoption in 2012 is optional for companies that have already issued securities overseas, or have registered an overseas securities issuance with the FSC, or have a market capitalisation of greater than NT$10 billion. Phase II companies (unlisted public companies, credit cooperatives, and credit card companies) will be required to adopt Taiwan-IFRS starting 2015, with optional early adoption starting 2013. The FSC said that it was taking this action to make Taiwan's capital markets more attractive to foreign investors and and help Taiwanese companies raise capital overseas.

Please click for access to the roadmap on the Accounting Research and Development Foundation (ARDF) website.

Deloitte Canada IFRS newsletter on income taxes

13 May 2009

Deloitte Canada has published a special May 2009 issue of their Countdown newsletter on IFRS transition in Canada.

Titled The Taxing Steps Toward Global Convergence: IASB Proposes Changes to Income Tax Accounting, this newsletter discusses the IASB exposure draft proposing amendments to IAS 12 Income Taxes. The comment deadline is 31 July 2009, with a final standard expected to be issued in 2010. Click here for:

 

FCAG will meet on 22 May in London

12 May 2009

The Financial Crisis Advisory Group (FCAG) will meet in London at the Crowne Plaza Hotel, 19 New Bridge Street, on Friday 22 May 2009 starting at 08:00am.

The IASB and the FASB jointly established the FCAG to advise them about the role of accounting during the crisis and potential changes. On 11 March 2009 the FCAG published an Invitation to Comment requesting responses to seven questions to assist FCAG in discussing accounting and reporting matters related to the global financial crisis and making recommendations thereon to the IASB and the US FASB. This will be the FCAG's fifth meeting. You can find the IAS Plus notes from the earlier meetings Here.

 

Guidance on software revenue recognition

12 May 2009

In October 1997, the American Institute of CPAs published Statement of Position (SOP) 97-2 Software Revenue Recognition.

SOP 97-21 provides guidance on revenue recognition for software and software-related products. While primarily developed for the software industry, the SOP increasingly applies to other industries in which software has become more than incidental to products and services. While IAS 18 addresses revenue recognition broadly, there is no parallel in IFRSs to SOP 97-2. Since the issuance of SOP 97-2, US standard setters released a wide range of guidance (over 50 publications in all!) clarifying specific aspects of software revenue recognition, including SOP 98-4, SOP 98-9, various AICPA Technical Practice Aids, EITF Issues, and SEC guidance. Nevertheless, as software technology continues to evolve, entities are continually confronting new challenges in recognising revenue for software arrangements. Deloitte United States has published the second edition of Software Revenue Recognition – A Roadmap to Applying AICPA Statement of Position 97-2 (PDF 169 pages, 886k) to address some of the most difficult-to-interpret provisions of SOP 97-2 as well as provide a new overview of the main topics in SOP 97-2 under the following headings:
  • Scope
  • Basic revenue recognition principles
  • Multiple-element arrangements
  • Additional software products, upgrade rights, and discounts
  • Postcontract customer support (PCS)
  • Services
  • Contract accounting

Agenda for May 2009 IASB meeting

11 May 2009

The IASB will hold its regular May 2009 meeting at its offices in London on Tuesday to Thursday 19-21 May 2009 (three days).

You can access the agenda on our May 2009 IASB meeting page.  We will also post Deloitte observer notes on this page as they are available.

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