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Video of a panel discussion on the future of IFRS in Africa

  • IASB (International Accounting Standards Board) (blue) Image

19 Jul 2013

The IASB has posted to its website a video of a panel discussion on the future of financial reporting in Africa which was part of a stakeholder event hosted jointly by the Trustees of the IFRS Foundation and the South African Institute of Chartered Accountants (SAICA).

One of the panelists was Hans Hoogervorst, chairman of the IASB. In his contributions to the discussion, he admitted that Africa might not have been that clearly on the IASB's radar yet, but with four IASB Board members from emerging economies the focus is shifting and he promised to keep Africa on hos personal and the IASB's radar more prominently.

He also cited instances where the IASB had paid careful attention to the needs of emerging economies. Most obvious, he said, were the discussions around impairment where the IASB's and the FASB's position differ. The FASB's proposal to recognise a charge equalling the present value of lifetime expected credit losses at initial recognition would be a clear disincentive in African markets where the upward trend in the markets is coupled with greater innovation and higher risk taking.

However, he also admitted voting against the wishes of emerging economies in cases where the brand of IFRSs might be endangered. He pointed at calls for making the IFRS for SMEs available for application by certain listed companies. Especially emerging economies feel that the more easily grasped IFRS for SMEs might be easier to adopt and might do more justice to their specific economic circumstances. The IASB chairman said that there was no way the IASB could prohibit jurisdictions from requiring the IFRS for SMEs for certain listed companies, however, he added, these jurisdictions could no longer call the standard applied thus the "IFRS for SMEs" and would have to call it something else - for example "South African GAAP".

The IASB chairman also touched on some general topics such as disclosures (where he explained his 10-point plan and the aspect of materiality), the IASB's view on integrated reporting ('it is not clear where this is going yet, but our standards don't bite each other') and the IASB's project on going concern.

Returning once more to impairment, he mentioned that the reactions to the IASB's proposals had been very encouraging. The IASB expects to finalise its re-deliberations by the end of 2013. It would take another two years, however, until a final standard would be effective.

Please click for access to the video on the IASB's website.

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