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2010

CEBS adapts the timeline for the revision of the Guidelines on Financial Reporting

22 Dec 2010

The Committee of European Banking Supervisors (CEBS) published its revised guidelines on financial reporting (FINREP rev2) on 15 December 2009, with an implementation date of 1 January 2012.

FINREP rev2 incorporated changes to IFRS, which were agreed in October 2009, and CEBS had envisaged that further changes to IAS/IFRSs would be taken into account, in due course, before starting implementing the revised FINREP framework. In particular, the IASB project on IAS 39 replacement and the proposal on IAS 1 that were scheduled to be agreed in 2010 were envisaged to be incorporated into the framework.

However, the IASB has, so far, only finalised those aspects of the project to replace IAS 39 Financial Instruments dealing with classification and measurement of financial instruments in IFRS 9. Final decisions on impairment and hedge accounting are currently expected in the first half of 2011. The final IFRS 9 will also be subject to an endorsement process at EU level.

Given these changes, CEBS suggests that countries that intend to implement the FINREP package for the first time before 1 January 2013 use the FINREP rev2 guidelines on an interim basis.

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New editorial corrections to IFRSs

22 Dec 2010

The IASB has posted to its website a new batch of Editorial Corrections to IFRSs.

This batch includes editorial corrections and changes to Bound Volume (Red Book) 2010, Bound Volume (Blue Book) 2011, IFRS 7 Financial Instruments: Disclosures – Transfers of Financial Assets (issued October 2010), IFRS 9 Financial Instruments (issued October 2010) and The Conceptual Framework for Financial Reporting (issued September 2010).
Click for Editorial corrections to IFRSs.

 

Publications by national Deloitte member firms

22 Dec 2010

Deloitte Germany has translated the IFRS Model Financial Statements for 2010 into the German language.

These financial statements illustrate the application of the presentation and disclosure requirements of International Financial Reporting Standards (IFRSs) by an entity that is not a first-time adopter of IFRSs. Deloitte Canada has translated IFRSs in your Pocket 2010 into the French language. This guide provides information about the IASB structure and includes summaries of each IASB standard and interpretation. In addition, Deloitte Singapore has published Singapore Illustrative Financial Statements 2010, which provides a set of sample financial statements of a typical listed company in Singapore. Click for:

 

Newsletter on closing out 2010

22 Dec 2010

Deloitte's IFRS Global Office has published an IFRS in Focus Newsletter – Closing out 2010.

This special edition of IFRS in Focus provides an overview of new and revised International Financial Reporting Standards issued by the IASB and Interpretations issued by the IFRS Interpretations Committee that are effective for December 2010 calendar year-ends and subsequent accounting periods. This newsletter also provides a brief snapshot of each new and revised standard and interpretation as well as the current status of IASB projects.

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Results of the Monitoring Board Working Group on Governance Review meeting

22 Dec 2010

The Monitoring Board Working Group on Governance Review met on 6 December 2010 in Tokyo to continue its discussion of the review of the governance framework around the Monitoring Board and the IFRS Foundation.

The fundamental question for the governance review is whether the current governance arrangements promote the IASB's primary mission of developing high quality, global accounting standards, while providing for both the accountability and independence of the IASB.

The Monitoring Board intends to issue a consultation document in early February 2011 for public comment, with a comment period of two months. Public meetings with stakeholders will be organised during the consultation period in Asia, Europe and the Americas.

Separately, the IFRS Foundation Trustees on 5 November 2010 issued a consultation document on the Trustees' ongoing Strategy Review. The consultation period had been subsequently extended to 24 February 2011.

Please click for IFRS Foundation Monitoring Board Press release (PDF 29k).

New publications from Deloitte's IFRS Global Office

21 Dec 2010

New publications from the Deloitte's IFRS Global Office are now available.

Deloitte's IFRS Global Office has published an IFRS in Focus Newsletter IASB issues Practice Statement on management commentary (PDF 91k) describing the recent Practice Statement, and an IFRS in Focus Newsletter IASB issues exposure draft on hedge accounting (PDF 86k) describing the recent exposure draft.

Also, our IFRS Global Office has updated the following IASB Project Insights to reflect the current status of the projects concerned:

Click for an Overview of all Project Insights available.

Recent US standard-setting activity and Deloitte publications

21 Dec 2010

The United States Financial Accounting Standards Board (FASB), the US Public Company Accounting Oversight Board (PCAOB) and the US Securities and Exchange Commission (SEC) have been busy issuing new and proposed standards, as well as discussing their activities with practitioners.

The following are selected items, including links to Deloitte publications where applicable:
  • 2010 AICPA Conference on SEC and PCAOB Developments – Heads Up newsletter (PDF 461k)
  • Year in Review: Accounting Roundup newsletter (PDF 749k)
  • Proposed Accounting Standards Update – Receivables (Topic 310): Deferral of the Effective Date of Disclosures about Troubled Debt Restructurings in Update No. 2010-20 - Exposure draft (link to FASB website), Heads Up newsletter (PDF 89k)
  • Proposed Accounting Standards Update – Health Care Entities (Topic 954): Presentation and Disclosure of Net Revenue, Provision for Bad Debts, and the Allowance for Doubtful Accounts - Exposure draft (link to FASB website), December 2010 edition of EITF Snapshot (PDF 88k)
  • Accounting Standards Update No. 2010-27, Other Expenses (Topic 720): Fees Paid to the Federal Government by Pharmaceutical Manufacturers - ASU 2010-27 (link to FASB website)
  • Accounting Standards Update No. 2010-28, Intangibles—Goodwill and Other (Topic 350): When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts - ASU 2010-28 (link to FASB website)
  • Accounting Standards Update No. 2010-29, Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations - ASU 2010-29 (link to FASB website)
  • CFO Insights newsletter: IFRS: Select Tax Considerations (PDF 133k)
  • CFO Insights newsletter: IFRS: The emerging convergence challenge (PDF 87k)

Click here to visit our United States country page.

We respond to the EC public consultation on country-by-country reporting

21 Dec 2010

Deloitte has submitted a response to the European Commission's public consultation that is designed to gather stakeholders' views on country-by-country reporting by multinational companies.

We conclude: "At this stage, we do not believe that imposing incremental country-by-country disclosure in financial statements prepared under IFRSs is warranted in view of the comprehensive post-implementation review of IFRS 8 planned by the IASB." Click to Download our Comment Letter (PDF 72k).

IASB amends IFRS 1 and IAS 12

20 Dec 2010

The International Accounting Standards Board (IASB) has published amendments to IAS 12 'Income Taxes' and IFRS 1 'First-time Adoption of International Financial Reporting Standards'.

IAS 12 Income Taxes requires an entity to measure deferred tax relating to an asset depending on whether the entity expects to recover the carrying amount of an asset through use or sale.  The amendment provides a practical solution to the application of these requirements in relation to investment property under IAS 40 Investment Property, introducing a presumption that recovery of the carrying amount of an investment property will normally be through sale.
The amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards made two limited amendments:
  • replacing references to "1 January 2004" with "the date of transition to IFRSs", eliminating the need for entities adopting IFRS for the first time to restate derecognition transactions occurring prior to the date of transition to IFRS
  • providing guidance on how an entity should resume presenting financial statements in accordance with IFRS after a period when the entity was unable to comply with IFRS because its functional currency was subject to severe hyperinflation.
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The Bruce Column — Tommaso Padoa-Schioppa

20 Dec 2010

The death of Tommaso Padoa-Schioppa at the age of 70, has robbed the IASB of a long and fruitful relationship in the years ahead.

He had only recently taken over the Chairmanship of the IFRS Foundation in July of 2010. And he had already signified the way in which his enormous experience of the European financial and regulatory scene would have been brought to bear. In an interview I did with him just after he took over the chairmanship he said of the whole IFRS and IASB process: "This is an extraordinary success story", and then continued: "What is necessary is to continue it and consolidate it, but there are some big challenges ahead which have to be faced courageously and without any preconditions". That was where his future value lay.

He had been Chairman of the Trustees previously, back in 2005. He had just retired after a seven-year stint at the European Central Bank. And at that point he had decided that he was effectively retiring after 40 years of public service. He had been on the ECB Board since it had been founded in 1998. He had been Chairman of the CONSOB, the main Italian regulatory body. He had been Chairman of the Basel Committee on Banking Supervision. But this initial stint with the Trustees came to a sudden end when he was asked to become Minister of Economy and Finance in the Italian Government. His work as Minister across the next few years helped reduce the Government's deficit and put Italy into a better economic place for the global economic crisis that was to come.

But it was that initial period as Chairman of Trustees which opened his eyes to the nature of what the IASB was achieving. "When I took the Chair of the Trustees I discovered an institution that was, in many respects, a much more advanced experience in international co-operation than all those I had practised before. The Board is not composed of national officials spending most of their time in national institutions, meeting only three or four times a year like, for example, the IOSCO Technical Committee or the Basel Committee. The IASB operates as a full-time board", he said. And he drew another distinction. "The IASB is not acting under the direction of national bodies. It is structurally committed to the international profile of its activity. So it is not a negotiating body between national systems."

He talked in that interview of the changes which the IASB had already wrought. "Before the IASB there was no consistency and comparability of data", he said. "Now, ten years later, IFRSs are used by a growing number of companies in the majority of countries around the world. Even in the US — where IFRSs are not yet adopted for domestic issuers - the divergence in the standards is significantly less than it was ten years ago. An agreed method of comparison is an essential precondition for a well-functioning global economy, a more efficient allocation of capital, and greater protection for investors."

And in the same interview he made his position on the importance of governance very clear. "It is a formula invented by the creators of the IASB", he said, "This formula proved very effective." But he accepted that not everyone was going to agree, partly because it represented change. "It is somewhat removed from the traditions of some countries, particularly of the EU, where setting accounting standards used to be the prerogative of the legislature", he said. "The debates on issues of governance can be explained by the fact that the formula on which the organisation is based represents a big innovation on the European tradition. The innovation proved necessary because the EU had failed to develop the consensus required to create common accounting rules through the more traditional method of public legislation."

In the most recent interview I did with him, a matter of a few weeks ago, his enthusiasm for the task ahead was undiminished. He will be much missed in the years ahead.

Robert Bruce
December 2010

 

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