2012

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Rio+20 conference may call for mandatory sustainability reporting

23 Mar 2012

The United Nations Conference on Sustainable Development (UNCSD) to take place in Rio de Janeiro, Brazil, in June 2012 ('Rio+20') may result in a call for mandatory sustainability or integrated reporting by the world's largest companies.

Whilst the conference is primarily focused on sustainable development problems such as sustainable cities, energy, water, food and ecosystems, reporting aspects of sustainability are also included. The "zero draft" of the outcome document from the conference, which has recently been debated at negotiations held in New York in the lead up to the conference, contains the following as part of its 'framework for action':

 

We call for a global policy framework requiring all listed and large private companies to consider sustainability issues and to integrate sustainability information within the reporting cycle.

Click for access to the zero draft document (link to Rio+20 website).

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Notes from the March IASB meeting

22 Mar 2012

The IASB held its regular monthly meeting on 20-21 March 2012 in London, part of it a joint meeting with the FASB. We have posted Deloitte observer notes from some sessions held on Tuesday and Wednesday, covering post-implementation reviews, effective dates, macro hedge accounting, and a review of the efficiency and effectiveness of the IFRS Interpretations Committee.

Click through for direct access to the notes:

Tuesday, 20 March 2012

Wednesday, 21 March 2012

* Notes from the insurance sessions held on Tuesday and Wednesday will be posted soon.

You can also access the preliminary and unofficial notes taken by Deloitte observers for the entire meeting.

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EFRAG to hold additional outreach meetings on proactive discussion papers

22 Mar 2012

The European Financial Reporting Advisory Group (EFRAG) announced additional outreach meetings on 17 April 2012 in Amsterdam and 18 April 2012 in Vienna regarding discussion papers 'Accounting for business combinations under common control' and 'Improving the Financial Reporting of Income Tax'.

The Amsterdam meeting (discussing only the discussion paper related to income tax) will be hosted by EFRAG and the UK and Dutch Accounting Standards Boards. The Vienna meeting will be hosted by EFRAG, the UK Accounting Standard Board, the Austrian Accounting Standard Board and the Italian standard setter (Organismo Italiano di Contabilità, OIC).

As noted in our earlier story, the meetings are designed to gather feedback from users on the topics developed in the discussion papers. The feedback will then be used by the EFRAG, and the accounting standard setters in future work with the IASB that relates to income taxes and business combinations under common control. Registration is requested by 23 March 2012 for the Amsterdam meeting and 29 March 2012 for the Vienna meeting.

Click for:

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Deloitte comment letter on amendments to IFRS 10

22 Mar 2012

Deloitte's IFRS Global Office has submitted a letter of comment to the International Accounting Standards Board (IASB) on its Exposure Draft ED/2011/7 – Transition Guidance – Proposed amendments to IFRS 10.

In the comment letter, we express our agreement with most of the proposed amendments to IFRS 10 Consolidated Financial Statements, but also note that further guidance would be beneficial for certain aspects of the adjustments required by paragraphs C4 and C4A.

Click for a full summary and our comment letter on the amendments to IFRS 10 exposure draft.

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EFRAG invites companies to participate in a study of IFRS 10 and the consolidation of special purpose entities

22 Mar 2012

The European Financial Reporting Advisory Group (EFRAG) invites companies to participate in a supplementary study on the impact of IFRS 10 on the consolidation of SPEs.

This study will be included in the impact analysis of the EU Commission to IFRS 10 – regardless of the endorsement advice from EFRAG. It will illustrate the impact of IFRS 10 Consolidated Financial Statements on the scope of the consolidation of SPEs. EFRAG will carry out this study in close cooperation with European national standard setters.

Click for EFRAG press release (link to EFRAG website) for more information, including how to participate in the supplementary study.

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South Africa standard-setting arrangements change, 'SA GAAP' to be discontinued

21 Mar 2012

Standard setting arrangements in South Africa are undergoing change, with the South African Accounting Practices Board (APB) to be wound up and its functions effectively transferred to the recently created Financial Reporting Standards Council (FRSC). As part of the changes, the use of South African Statements of Generally Accepted Accounting Practice (SA GAAP) is to be discontinued.

Under recent changes to the companies law in South Africa, the FRSC was established in late 2011 as the legally constituted standard-setter for South Africa. The APB was previously the recognised standard-setter and began the process of harmonising SA GAAP with International Financial Reporting Standards (IFRS) in 2003. The APB subsequently decided to adopt IFRS standards as SA GAAP without amendment (only until May 2011), but also issued additional guidance in the form of interpretations of SA GAAP. Prior to the current developments, SA GAAP was permitted to be applied by certain entities depending on a 'public interest score'.

Under the changes, SA GAAP will cease to apply in respect of financial years commencing on or after 1 December 2012. Entities previously applying SA GAAP will be required to apply either IFRS (applying the transitional requirements of IFRS 1 First-time Adoption of International Financial Reporting Standards) or the IFRS for SMEs. It is also proposed that the FRSC will be given power to issue 'financial reporting pronouncements' (FRPs) to take account of local circumstances or issues not specifically covered by IFRS or the IFRS for SMEs, provided they are not in conflict with IFRS or the IFRS for SMEs.

Click for Joint APB-FRSC statement (link to South African Institute of Chartered Accountants website).

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IASB schedules additional education session in April 2012

21 Mar 2012

The IASB has tentatively scheduled an additional meeting to be held 11-13 April 2012. The meeting has been designated an education session but the specific topics to be discussed have not yet been announced.

The final dates and times for the meeting at not known as this stage. The meeting precedes the regular April meeting which is scheduled for 16-20 April 2012.

We will post the agenda for the education session meeting, and any other information about the meeting, as it becomes available.

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Updated EFRAG 'endorsement status report'

21 Mar 2012

The European Financial Reporting Advisory Group (EFRAG) has updated its report showing the status of endorsement, under the EU Accounting Regulation, of each IFRS, including standards, interpretations, and amendments.

Since the last report, the recent amendment to IFRS 1 First-time Adoption of International Financial Reporting Standards in relation to government loans has been added to the report, with final endorsement of the amendment expected in the fourth quarter of 2012.

Click to download the Endorsement Status Report as of 19 March 2012.

You can always find the endorsement status report here.

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IFAC reiterates its call for global adoption of IPSAS by governments

20 Mar 2012

The latest Policy Position Paper from the International Federation of Accountants (IFAC) renews its call for governments to apply accrual accounting principles in light of ongoing sovereign debt issues, and in particular, to adopt International Public Sector Accounting Standards (IPSASs).

IFAC Policy Position Paper 4, Public Sector Financial Management Transparency and Accountability: The Use of International Public Sector Accounting Standards, sets out IFAC’s view that governments around the world must provide clear and comprehensive information regarding the financial consequences of economic, political, and social decisions, in order to protect the public as well as investors in government bonds.

The paper notes the following:

 

The type of information required can only be provided through a high-quality, robust, and effective accrual-based financial reporting system, which allows for government assets and liabilities (including debt) to be appropriately recorded, reported, and disclosed — and hence effectively monitored. The most globally accepted high-quality accrual-based financial reporting system is IPSASs. IPSASs provide for the full disclosure of all assets, liabilities, and contingent liabilities, which is vital for assessing the true economic implications of public sector financial management. The disclosure of all liabilities, including long-term obligations (e.g., pension obligations), also may encourage government leaders to make decisions that are driven by matters other than short-term political incentives.

IPSAS are issued by the International Public Sector Accounting Standards Board (IPSASB), which is an independent board of IFAC. A number of global organisations have adopted IPSAS, and a number of countries are considering adoption at the current time.

Click for IFAC press release (link to IFAC website).

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Archive available of FASB chairman's webcast on priorities for 2012

19 Mar 2012

On 12 March, Leslie F. Seidman, chairman of the Financial Accounting Standards Board (FASB), hosted a webcast to discuss the FASB's priorities for 2012. An archive of this webcast is now available.

During this webcast, Ms Seidman discussed the progress and future timelines of the four priority convergence projects with the IASB, which are Revenue recognition, Leases, Financial instruments and Insurance contracts. Ms Seidman noted that the FASB and IASB are still working to "finalize these projects as quickly as possible, but without sacrificing quality".

Click for webcast archive (link to FASB website).

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