May

Deloitte guide to IFRS 3 in French

11 May 2009

Deloitte Canada has published Regroupments d'Enterprises et Changements dans les Participations: Guide portant sur la version révisée des normes IFRS 3 et IAS 27.

This is the French translation of our English language publication Business Combinations and Changes in Ownership Interests: A Guide to the Revised IFRS 3 and IAS 27 (PDF 647k. This guide deals mainly with accounting for business combinations under the 2008 revision to IFRS 3. Where appropriate, it deals with related requirements of IAS 27 (Revised 2008) – particularly as regards the definition of control, accounting for non-controlling interests, and changes in ownership interests. Other aspects of IAS 27 (such as the requirements to prepare consolidated financial statements and detailed procedures for consolidation) are not addressed. There are 16 chapters plus appendices that (a) compare the 2008 versions of IFRS 3 and IAS 27 (2008) with their predecessors, and (b) identify the continuing differences between IFRSs and US GAAP.
Click to view Regroupments d'Enterprises et Changements dans les Participations: Guide portant sur la version révisée des normes IFRS 3 et IAS 27 (PDF 561k).

IASB Member comments on global financial crisis

10 May 2009

IASB Board member (and former Deloitte United States partner) John Smith addressed the European Commission Conference Financial Reporting in a Changing World.

The focus of his remarks was on the impact of the global financial crisis on accounting standard-setters in general and on the IASB in particular. You can Download Mr Smith's Remarks from the IASB website (PDF 31k). Here is an excerpt:

The financial crisis has highlighted three primary lessons for accounting standard-setters.

First: The integrated nature of capital markets, combined with the mobility of capital itself, highlights the need for a commonly accepted set of accounting standards.

Second: Financial institutions, regulators and investors failed to understand adequately the risks being taken. Accounting should play an important role in assisting all parties in this regard. Accordingly, there is a need to provide additional transparency to the risks being taken by financial institutions and provide meaningful information to investors and regulators.

Third: The current accounting rules create numerous options, which reduce comparability and add unnecessary complexity. Accordingly there is an urgent need to address the accounting for financial instruments to reduce complexity, enhance comparability and relevance and provide a basis for convergence worldwide.

We at the IASB are taking actions on all of these fronts.

 

Notes from the May 2009 IFRIC meeting

09 May 2009

The International Financial Reporting Interpretations Committee (IFRIC) met at the IASB's offices in London on Thursday 7 May 2009 (one day only).

Click here to go to the preliminary and unofficial Notes Taken by Deloitte Observers for the meeting.

CAQ Guide to Public Company Auditing

08 May 2009

The Center for Audit Quality of the American Institute of CPAs has published a Guide to Public Company Auditing.

The guide illustrates for capital market stakeholders the important role public company auditing plays in preserving the strength and stability of US capital markets. Written with the layperson in mind, the Guide provides answers to the most frequently asked questions about, and topics related to, public company auditing, including:
  • The relationship between company management, the audit committee and the auditors
  • Audit team composition
  • Steps in the audit process
  • Finding fraud
  • Auditor independence
Click to Download the Guide to Public Company Auditing (PDF 1,520). We have posted the guide on IAS Plus with the kind permission of the Center for Audit Quality.

 

Commissioner McCreevy's comments on IFRSs and IASB

08 May 2009

Charlie McCreevy, the European Commissioner for Internal Market and Services, addressed a range of issues relating to IFRSs and the IASB in his keynote address at the European Commission's conference on Financial Reporting in a Changing World in Brussels yesterday.

He cited the benefits of IFRSs for Europe and urged countries that have not yet adopted IFRSs, including the United States, to make the move. He cited recent progress in improving the IASCF's governance structure but said more action is needed regarding the geographic composition of IASB, due process, and balancing the Board with members with more practical experience. He urged the IASB to accelerate its work on issues identified as a result of the global financial crisis, including fair value measurement, aligning the IASB's impairment rules with those in the United States, and loan loss provisioning. Click to Download Commissioner McCreevy's Remarks (PDF 73k).

IPSASB proposes convergence with IFRS 3 and IAS 38

08 May 2009

The International Public Sector Accounting Standards Board (IPSASB) has published two new exposure drafts – ED 40 'Intangible Assets' and ED 41 'Entity Combinations from Exchange Transactions' – proposing that governments and other public sector entities follow the related IFRS requirements.

ED 40 proposes an IPSAS that converges with IAS 38 Intangible Assets and also incorporates guidance on website costs in Interpretation SIC-32 Intangible Assets - Web Site Costs. It also includes guidance on intangible heritage assets.

ED 41 is converged with IFRS 3 Business Combinations. Entity combinations that arise from non-exchange transactions are being addressed in a separate public sector-specific project.

Comments on the EDs are requested by 15 August 2009. You can download the EDs at www.ifac.org/EDs.

 

IASB webcasts on leases discussion paper

07 May 2009

On 13 May 2009, the IASB will host two live webcasts introducing the joint IASB-FASB discussion paper Leases: Preliminary Views.

The DP was published on 19 March 2009, with comments due by 17 July 2009. In the DP the IASB and the FASB propose a possible new model for lease accounting. The model is based on the principle that all leases give rise to liabilities for future rental payments and assets (the right to use the leased asset) that should be recognised in the lessee's statement of financial position. The live web presentation will include an interactive question and answer session. Questions can be submitted on-line during the presentation. Instructions will be given at the beginning of the presentation. Details:
  • Webcast Topic: Joint IASB-FASB discussion paper Leases: Preliminary Views
  • Date: Wednesday, 13 May 2009
  • Times: 9:30am (London time) and again at 15:30pm (London time)
  • Presenters: Jan Engstrom, Member of the Board. and Rachel Knubley, Senior Project Manager

 

CIMA study on complexity of corporate reporting

07 May 2009

The Chartered Institute of Management Accountants (CIMA) has published a report on Complexity, Relevance and Clarity of Corporate Reporting: The views of CIMA FTSE 350 Directors.

The overall conclusion:

We fear that statutory accounts limit the scope for describing what a business actually does, that audit now merely confirms that the technical accounting has been performed in line with the regulations, and that management has fewer opportunities to explain performance and strategy – with integrity – because they are bound by complex rules to report less relevant information in more detail. The report identifies four areas for improvement:

The report identifies the following areas for improvement:
  • Principles based standards. Firstly, to avoid setting rules too tightly to allow for the communication of genuinely useful and insightful information, we strongly urge an adherence to a principles based approach to drawing up reporting requirements. The pressure to align IFRS with those of United States GAAP may have started to tilt the balance towards rules based standards. But this could only further complicate financial reporting and limit the ability of CFOs and boards to apply sensible judgments to how they translate practical management information into published reports and accounts.
  • Materiality. Today's financial IT systems and more complicated business practices are capable of producing huge volumes of data. But we must remain focused on what really has a bearing on a company's performance and viability.
  • Narrative reporting. Take care not to overcomplicate the management commentary. This is a crucial area of financial reporting, and one that has evolved considerably over the past few years. We believe that published financial reports, should communicate to a wide audience the kind of information usually imparted in analysts presentations – in other words, the data and assumptions that drive decision making, information which often falls outside the scope of GAAP.
  • Integrity. Integrity and professionalism are the cornerstones of our profession and we expect our members to display these qualities at all times. But excessive complexity in the accounting rules can actually make it harder for them to do so.
Click to view Complexity, Relevance and Clarity of Corporate Reporting: The views of CIMA FTSE 350 Directors (PDF 181k). We are grateful to the Chartered Institute of Management Accountants for giving IAS Plus permission to post the report.

 

Accounting Roundup – April 2009

06 May 2009

We have posted the April 2009 Edition of Accounting Roundup published by Deloitte & Touche LLP (United States).

The newsletter is now organised by topic rather than by standard-setter. Topics covered in this issue include:

Fair Value Measurements

  • FASB Issues Guidance on Measuring Fair Value When Market Activity Declines
  • FASB Issues FSP on Interim Fair Value Disclosures
Investments in Debt and Equity Securities
  • FASB Issues FSP on Other-Than-Temporary Impairments
  • SEC Issues Staff Accounting Bulletin on Other-Than-Temporary Impairments
Business Combinations
  • FASB Issues FSP on Assets Acquired and Liabilities Assumed in a Business Combination That Arise From Contingencies
Pensions and Other Postemployment Benefits
  • GASB Issues Invitation to Comment on Pension Standard
Derivative Instruments and Hedging Activities
  • GASB Issues Derivative Instruments Guide
Other Accounting
  • XBRL 2009 Taxonomies Released
  • GASB Issues Statement on GAAP Hierarchy
  • GASB Issues Statement on Related-Party Transactions, Going-Concern Considerations, and Subsequent Events
  • IASB Issues Annual Improvements Standard
  • IASC Foundation Issues IFRS Taxonomy 2009 and Publishes XBRL Handbook for Public Comment
Other SEC Matters
  • SEC's Division of Corporation Finance Releases Updated Financial Reporting Manual
  • SEC Staff Issues Compliance Guide for Small Entities
  • SEC Issues Technical Amendments to Conform Various Rules, Forms, and Schedules to Statements 141(R) and 160
  • SEC Issues New Compliance and Disclosure Interpretations
  • Other SEC Rules Issued or Proposed in April 2009
Other Auditing
  • PCAOB Issues Staff Practice Alert 4 Regarding Fair Value Measurements, Disclosures, and Other-Than-Temporary Impairments
  • PCAOB Issues Concept Release on Possible Revisions to Audit Confirmations Standard
  • AICPA Proposes Clarifying and Converging SAS
  • AICPA Issues Exposure Draft on Compilation and Review Standards
  • AICPA Issues Guidance on Applying Agreed-Upon Procedures to XBRL-Tagged Data
Click to view April 2009 Edition of Accounting Roundup (PDF 362k). You will find past issues of Accounting Roundup Here.

 

Deloitte's Laurence Rivat appointed to IFRIC

06 May 2009

The Trustees of the IASC Foundation have appointed Laurence Rivat, a partner at the national office of Deloitte France, as a new member of the International Financial Reporting Interpretations Committee (IFRIC) for a three-year term beginning on 1 July 2009. She will replace Ken Wild, partner in Deloitte United Kingdom, whose term expires 30 June 2009. The Trustees also reappointed three current IFRIC members to three-year terms – Sara York Kenny, Consulting Advisor, International Finance Corporation (World Bank Group); Takatsugu Ochi, Assistant General Manager, Financial Resources Management Group, Sumitomo Corporation; and Ruth Picker, Partner and Global Director, Global IFRS Services, Ernst and Young.

Laurence Rivat has been the leader (since 2001) of one of six Deloitte IFRS Centres of Excellence and a member of the Deloitte IFRS Leadership Team. Ms Rivat is actively involved in global activities on IFRSs on various subjects. Click for IASCF Press Release (PDF 101k).

 

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