June

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PCAOB releases 2010 Annual Report

23 Jun 2011

The 2010 Annual Report of the US Public Company Accounting Oversight Board (PCAOB) reports that 2,397 firms were registered with the PCAOB, including 894 non-U.S. firms located in 86 jurisdictions.

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IASB webcast on the amendments to IAS 19

22 Jun 2011

On June 16 the IASB published amendments to IAS 19 Employee Benefits.

Next Monday, the IASB will give a webcast introducing the amended version of IAS 19 including a live question and answer session. For the convenience of participants in different time zones two slots have been scheduled.
  • Monday, 27 June 2011 — Improvements to the accounting for post-employment benefits Webcasts will be held at 9.30am and 3.30pm, London time. Registration is available through the IASB's website.

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IASB publishes proposals for amendments under its annual improvements project

21 Jun 2011

The International Accounting Standards Board (IASB) has published to its website an exposure draft (ED) of proposed amendments to five International Financial Reporting Standards (IFRSs) under its annual improvements project.

The IASB uses the annual improvements project to make necessary, but non-urgent, amendments to IFRSs that will not be included as part of another major project.

ED/2011/2 Improvements to IFRSs proposes the following amendments:

IFRS Subject of amendment
IFRS 1 First-time Adoption of IFRSs Repeated application of IFRS 1

Borrowing costs relating to qualifying assets for which the commencement date for capitalisation is before the date of transition to IFRSs
IAS 1 Presentation of Financial Statements Clarification of requirements for comparative information

Consistency with the updated Conceptual Framework
IAS 16 Property, Plant and Equipment Classification of servicing equipment
IAS 32 Financial Instruments: Presentation Clarify that income tax relating to distributions to holders of an equity instrument and income tax relating to transaction costs of an equity transaction should be accounted for in accordance with IAS 12 Income Taxes.
IAS 34 Interim Financial Reporting Interim financial reporting and segment information for total assets

The ED proposes that all of the amendments will be effective for annual periods beginning on or after 1 January 2013, although entities shall be permitted to adopt them earlier. Click for IASB Press Release (link to IASB website).

You can access the ED via the the 'Comment on a proposal' page on the IASB's website. The IASB requests comments on the ED by 21 October 2011.

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The Japanese Minister for Financial Services mentions deferred timing of mandatory IFRS adoption, reinstates US-GAAP option

21 Jun 2011

The Japanese Minister for Financial Services, Shozaburo Jimi, has outlined a number of changes in relation to the possible adoption of International Financial Reporting Standards (IFRSs) in Japan.

Japan has not yet made a decision on whether or not to mandatory adopt IFRSs, although voluntary adoption already started in 2010. The Business Accounting Council of Japan, with expanded members, will commence deliberation on the adoption question in later in June 2011.

The key changes announced by the Minister include:

  • Mandatory application of IFRS will not take place from the business year ending March 2015, at the very least, and a sufficient time period of five to seven years will be permitted for preparation if and after mandatory application of IFRSs is decided
  • The currently legislated expiry date of the ability to use US GAAP for disclosure purposes, namely up to the business year ending on or before 31 March 2016, will be removed so that the firms will be able to continue their use of US GAAP beyond that date.

As background to this change, the paper released by the FSA referred to various changes in the environment both in and out of Japan that have taken place since the issuance of the Interim Report in June 2009, including the release of the SEC work plan (February 2010), the announcement of a delay in the convergence programme by the IASB and FASB (April 2011), the US SEC staff report on the so-called 'condorsement' approach to the adoption of IFRS in the United States (May 2011), and domestic Japanese events such as the Great East Japan Earthquake and tsunami.

Click for more information (link to the Japanese Financial Services Agency, also available in Japanese).

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Integrated reporting and sustainability reporting update

20 Jun 2011

Following is a summary of recent developments in integrated reporting, sustainability reporting, and related topics:

  • IIRC European roundtable.The Federation of European Accountants (FEE) hosted a European Roundtable on Integrated Reporting for the International Integrated Reporting Committee (IIRC) on Friday 17 June 2011. Topics discussed included how to operationalise integrated reporting (including possible linkages with XBRL), the necessary framework for integrated reporting, and governance of the IIRC. More information is available on the FEE website
  • IFRS Advisory Council consideration of Integrated Reporting. The IFRS Advisory Council meeting currently being held (see our story with the agenda) is receiving a presentation from the IIRC on integrated reporting. The Agenda paper (PDF 548k, link to IASB website) provides a useful summary of the IIRC's plans and the likely timetable for the issue of the IIRC Discussion Paper
  • Integrated reporting study. Harvard Business School has released the outcomes on a study of integrated reporting. To determine the extent to which corporate and investor behaviour is changing to contribute to a more sustainable society, the state of integrated reporting in 23 countries was analysed, classifying various countries by both the extent of investor interest in integrated reporting and the level of integrated reporting by companies in that country. The report can be accessed on the Harvard Business School website
  • Report on 'natural capital'. The University of Cambridge Natural Capital Leaders Platform, a business-led programme addressing the impacts of natural capital loss and degradation on business and wider society, has released a report arising from the initial phase of its work. The report highlights the need to integrate the economic importance of natural capital into the investment community (following the 2010 TEEB study), which will likely require mandatory regulation with sector-specific sub-directives to help to create an even playing field within the market. The report also recommends incorporating natural capital into national economic indicators. The summary report is available on the University of Cambridge website
  • Carbon reporting in the UK. The United Kingdom Department for Environment, Food and Rural Affairs (DEFRA) has launched a public consultation (link to DEFRA website) seeking views on whether regulations should be introduced to make it mandatory for some UK companies to report on their greenhouse gas (GHG) emissions or whether the Government should continue to encourage measuring and reporting of GHG emissions on a voluntary basis. The Carbon Disclosure Project (CDP) has responded (link to CDP website) supporting the introduction of regulations requiring British businesses to report their GHG emissions.

Click for our sustainability reporting page.

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SEC Chief Accountant discusses convergence

20 Jun 2011

James L. Kroeker, Chief Accountant of the United States Securities Exchange Commission (SEC) has provided comment on the IFRS-US GAAP convergence process being undertaken by the IASB and FASB (the 'Boards').

In a recent speech given to the University of Southern California SEC and Financial Reporting Institute Conference, Mr Kroeker emphasised the need for the Boards to have adequate time to develop fully converged standards.

An extract follows:

"I believe it is critical that, as it relates to the MOU projects, that the Boards take all reasonable steps to maximize the prospect of converged, high-quality solutions. For example, currently the Boards are not aligned as it relates to their approaches to consideration of hedge accounting in the context of their financial instruments project. Numerous conceptual, operational and practical questions have been raised based upon proposals to date that should be considered jointly by both Boards. I believe that , in the long run, a measure of added time to provide for joint deliberations on a project as critical and as complex as hedge accounting will prove to be far more beneficial than any gains that are perceived in finalizing deliberations individually.

In achieving high-quality, converged solutions, the Boards will inevitably be faced with difficult choices about how best to proceed. I continue to encourage the Boards to reconcile differences in the proposed standards and to work to reach converged and improved solutions to these difficult financial reporting issues. In monitoring the accounting standard-setting process, my focus tends to be on ensuring there is the appropriate balance between conceptual grounding and pragmatism in the standards being developed."

Click for full text of the speech (link to the SEC website).

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Agenda for IFRS Advisory Council Meeting

20 Jun 2011

The IFRS Advisory Council is meeting in London on 20-21 June 2011. The agenda for the meeting is set out below.

IFRS Advisory Council Meeting Agenda
20-21 June 2011, London
Monday, 20 June 2011
  • Welcome and Chairman's preview
  • Overview of last four months
  • IASB Activities
  • EFRAG's outreach on Leases and Revenue recognition
  • SEC IFRS Workplan: status update
  • The IASB's post-2011 agenda
  • Council performance self-review
  • Crosscutting issues (follow up from the November 2010 meeting)
  • Translation issues
  • Use of underlying earnings and non GAAP measures
  • Who is implementing IFRSs – and how? (IFRS 'branding')

Tuesday, 21 June 2011

  • Monitoring Board review
  • Trustee strategy review
  • Trustee and Monitoring Board reviews
  • IFRS 'branding'
  • Integrated reporting

Click for access to the full agenda and agenda papers (link to IASB website).

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Consultation on IASB's future agenda

19 Jun 2011

The IASB has formally announced that it will be undertaking for the first time a public agenda consultation on its future work plan.

In February 2010 the Trustees of the IFRS Foundation, the IASB's oversight body, announced enhancements to their governance arrangements, including the decision to undertake a three-yearly public consultation on the IASB's future technical agenda, in addition to consulting the Trustees and the IFRS Advisory Council annually on the existing and future agenda.

A paper (link to IASB website) being considered at this week's IFRS Advisory Council Meeting (see our 20 June 2011 article) outlines the expected timetable for the consultation process:

  • July 2011: Discuss revised proposals with IFRS Foundation Trustees
  • July 2011: Board discussion and finalisation of consultation proposals
  • July 2011: Launch of Agenda Consultation, with a minimum 120 day comment period
  • 30 November 2011: Consultation period ends
  • Q1 2012: Publication of comment summary, start of Board discussions and consultation with the IFRS Advisory Council
  • Q2 2012: Publication of Feedback Statement summarising what has been learnt from the agenda consultation

The paper outlines the primary focus of the consultation will be a 'Request for Views' document which will consider the agenda from two perspectives: (1) the overall strategic direction and balance of the agenda, and (2) understanding the financial reporting needs of stakeholders and how these might be balanced with constraining factors such as stakeholder and IASB resource capacity and the IASB's existing priorities.

Click for IASB announcement (link to the IASB website).

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EFRAG Update with meeting summary for the June EFRAG TEG meeting

17 Jun 2011

The European Financial Reporting Advisory Group (EFRAG) has released the June 2011 issue of its EFRAG Update newsletter.

The EFRAG TEG meeting held on 8 to 10 June 2011 focused on:

Click for the EFRAG Update (PDF 377k, link to EFRAG website). Links to earlier issues are available here.

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Deloitte publications update

17 Jun 2011

The following Deloitte publications are now available:

Global Publications

Deloitte (Colombia)

Deloitte (Germany)

Deloitte (New Zealand)

  • Accounting Alert — Quarterly update (PDF 424k) includes tables which outline new and revised pronouncements that either are to be applied for the first time at 30 June 2011, or which may be early adopted at that date

Deloitte (United States)

 

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