The consultation had been launched in August 2014 to examine whether the adoption of IFRS improved the efficiency of EU capital markets by increasing the transparency and comparability of financial statements.

Access to the responses received is available here. The European Commission is expecting to publish a summary results of the consultation soon.

At the heart of the programme is statement of shared beliefs, signed by all participants, that:

• highlights the importance of high quality, transparent reporting for building trust in the capital markets and for making investment decisions;
• publicly reaffirms the IASB's commitment to continue to seek and consider investor views in the development of new accounting standards; and
• documents the investors community's commitment to the development of high quality financial reporting standards by working with the IASB to ensure that the investor perspective is articulated clearly and is considered in the standard-setting process.

As part of the programme, the investment firms commit to an ongoing dialogue, executive level support of the programme and access to analysts and portfolio managers. In return, the IASB has committed to providing an improved channel through which to influence standard development, developing investor-tailored webcasts, providing investor-friendly articles on proposed changes, providing access to IASB members and staff, and providing investor-focused education sessions.

Please click for more information on the new programme on the IASB's website.

Mr Hoogervorst stated:

As you know, the Commission is currently evaluating the impact of IFRS in the EU. We do not expect this evaluation to say that IFRS is perfect, because we know it is not. Still, we feel pretty confident that the verdict will be that, overall, IFRS has had a positive impact on the European economy.

The IASB Chairman also discussed some potential 'critical remarks' that the Commission's report may contain and noted that the IASB will take the feedback constructively:

We acknowledge financial statements may have become too long. We are reviewing our disclosure requirements to reduce the overload of boilerplate disclosures. We understand the concerns of investors who fear unwarranted profit taking on the basis of flimsy valuations. In our new Conceptual Framework for Financial Reporting, we will make clear that prudence should be exercised to prevent overstatement of assets and profits. We are also against understatement of liabilities, which is why lease commitments need to brought to the balance sheet.

The ITG was created to keep the IASB informed on issues occurring during implementation of the new impairment requirements in IFRS 9 Financial Instruments, to assist in determining what action may be needed to resolve diversity in practice and to provide a public forum for stakeholders to learn about the new impairment requirements from others involved with implementation. The first face-to-face meeting of the group was planned for the last quarter in 2014. However, the agenda papers for the conference call state: "We have yet to receive many substantive technical implementation issues on the impairment requirements of IFRS 9 that meet the submission criteria." Therefore, the first physical meeting will be replaced by a conference call to discuss operating procedures and the status of implementation. Please click for access to a detailed agenda and the agenda papers for the call on the IASB website.

The Effects Analysis Consultative Group (EACG) was established in 2013 to provide independent advice to the IASB on how it should consider the effects of changes it develops to its financial reporting requirements (IFRS). Membership of the EACG includes representatives from a geographically and professionally diverse group of stakeholders.

The report that has now been presented to the Trustees and that is also publicly available is intended to support the IASB in further embedding effects analyses within its due process, with the objective of strengthening the standard-setting process.

The EACG’s report identified a series of recommendations among which are the following:

The IASB should assess and explain how general purpose financial reports are likely to change because of new requirements, and why those changes will improve the quality of general purpose financial reports. Furthermore, the IASB should explain why it considers those changes to be justifiable, demonstrating how it assessed the likely effects on the direct costs to preparers of meeting the new requirements and the related costs to users.

The IASB should work co-operatively with local standard-setters so that it can plan its fieldwork and outreach to see whether there are opportunities to organise fieldwork in ways that are mutually beneficial for the IASB and those local jurisdictions.

The IASB should plan its fieldwork so that it is proportionate to the changes in financial reporting being proposed. A more pervasive or significant potential change would normally warrant a more comprehensive assessment programme. The type, and depth, of fieldwork undertaken should also reflect the stage of development of the project.

The IASB should aim to undertake consultation that is geographically broad-based so that its Standards are written with principles that can be applied globally. Other accounting standard-setters can help by providing the IASB with analysis and information about factors and possible effects that might be unique to their jurisdiction.

The IASB should make available information about the nature of fieldwork and outreach that it has undertaken. This information should be made available throughout the development of the project.

The format of the analysis of the likely effects of a proposed change in financial reporting should reflect the stage of the proposals. When a new Standard is issued, the IASB should generally prepare a separate Effects Analysis Report.

The full EACG report as well as the press release are available on the IASB's website.

Click through for direct access to the notes:

Wednesday, 19 November 2014

• Conceptual Framework
  • Sweep issues
  • Update on the conceptual framework projects of the FASB and IPSASB
  • Measurement – transaction costs.

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

The exposure draft, Proposed Changes to Part C of the Code Addressing Presentation of Information and Pressure to Breach the Fundamental Principles, is focused on accountants who work on their own or in organisations other than public accounting practices, such as in commerce, industry, education, and the public and not-for-profit sectors. The exposure draft addresses key priorities for such accountants contained in Part C of the Code, which were identified through a consultation process involving working groups, the International Federation of Accountants (IFAC) Professional Accountants in Business Committee (PAIB), IFAC member bodies and the IESBA Consultative Advisory Group (CAG).

The key proposals include:

• Widening the scope of the existing requirements around the preparation and reporting of information to reduce the emphasis on external financial information, and instead focus on both financial and non-financial information for both internal and external purposes. This would mean that the requirements of the Code for information to be prepared "fairly and honestly" would apply consistently to all information produced by a PAIB. Examples provided in the exposure draft of information captured include operating and performance reports, budged and forecasts, information provided to internal and external auditors, risk analyses, general and special purpose financial statements, tax returns and regulatory reports
• Providing additional guidance around the "fair and honest" principle when preparing financial and non-financial information, including:
  • Preparing or presenting information in a manner that is intended neither to mislead nor influence contractual or regulatory outcomes inappropriately
  • Not omitting information with the intention of rendering the information misleading
  • Presenting the information in accordance with a relevant reporting framework where applicable (this is currently a separate requirement of the Code, but is proposed to be repurposed as guidance on applying the "fair and honest" principle)
• In relation to the "fair and honest" preparation and presentation of financial information, to introduce additional guidance that a PAIB should not exercise judgements and discretion available under the applicable financial reporting framework in a manner that is intended to mislead, including when determining estimates, selecting a particular accounting method among two or more alternatives, determining the structuring of transactions and determining disclosures
• Proposing a new section of the Code to provide more robust and practical guidance on how a PAIB should respond when facing pressure from a superior or others that may result in a breach of the fundamental principles of the Code. The new section would introduce a explicit requirements for a PAIB not to allow pressure to result in a breach of the fundamental principles, and to prohibit a PAIB from placing pressure on others that would result in such a breach.

The exposure draft is open for comment until 15 April 2015. Click for IESBA press release (link to IFAC website).

Click through for direct access to the notes:

Wednes­day, 19 November 2014

• Insurance contracts

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