February

IASB staff publishes update on the leases project

24 Feb 2015

The IASB staff has published a document that provides an overview of the definition of a lease as it would be defined in the upcoming leases standard as well as (1) accompanying guidance to assess whether a contract is a lease, (2) a summary of decisions, and (3) examples portraying hypothetical situations.

On 16 May 2013, the IASB and FASB issued a revised exposure draft to improve the accounting for leases. The boards will be ending their redeliberations soon and will be deciding on an effective date within the next few months. According to this update, the new leases standard is expected to be issued by the IASB before the end of 2015, which is slightly different than the IASB’s current work plan of an expected issuance in second half of 2015.

For more in­for­ma­tion, see the document on the IASB’s website. In addition, Deloitte has followed the re­de­lib­er­a­tions of the IASB and all tentative decisions to date; see our leases project page for details.

Table connecting corporate non-financial reporting approaches

24 Feb 2015

The Climate Disclosure Standards Board (CDSB) has published a table showing how the most widely used corporate natural capital-related reporting approaches align.

The table cross references the requirements in the CDSB Reporting Framework, which will be available as completed version in March, with commonly used reporting provisions such as CDP, SASB, GRI, IIRC, UN Global Compact as well as regulatory requirements such as the new EU Non-Financial Reporting Directive, the UK Companies Act, the German Sustainability Code and Grenelle II. The table allows stakeholders to identify similar requirements and shows how information collected for one reporting audience/purpose can be used to satisfy other audiences and purposes.

Please click to access the table and a corresponding press release on the CDSB website.

February 2015 IASB meeting notes posted — part II

23 Feb 2015

The IASB met at its offices in London on 18–20 February 2015. Some of the meeting was a joint session with the FASB. We have posted the Deloitte observer notes from the sessions on the disclosure initiative and IFRS implementation issues.

Click through for direct access to the notes:

Thursday, Feb­ru­ary 19, 2015

Friday, Feb­ru­ary 20, 2015

The pre­lim­i­nary and un­of­fi­cial notes taken by De­loitte ob­servers for the entire meeting are also avail­able.

IFRS Foundation appoints two new Vice-Chairs to the Advisory Council

23 Feb 2015

The IFRS Foundation has announced the appointments of Gavin Francis and Goro Kumagai as Vice-Chairs to the IFRS Advisory Council.

Mr Francis represents the Institute of International Finance and is the Deputy Group Chief Accounting Officer at HSBC Holdings plc. Mr Kumagai represents the Securities Analysts Association of Japan on the IFRS Advisory Council and is a Senior Fellow of the Strategic Research Department at Mizuho Securities Co. Ltd.

For more in­for­ma­tion, see the press release on the IASB's website.

Agenda for the March 2015 ASAF meeting

23 Feb 2015

The International Accounting Standards Board (IASB) has released the tentative agenda for the meeting of the Accounting Standards Advisory Forum (ASAF), which is to be held at the IASB's offices in London on 26-27 March 2015. The meeting will discuss a number of the IASB's active projects, including the conceptual framework, leases, the disclosure initiative, and insurance contracts. IFRS 15 'Revenue from Contracts with Customers' and initial feedback from the ASAF review will also be discussed.

The agenda for the meeting is summarised below:

Thursday, 26 March 2015 (9:20-18:20)

  • Financial instruments with characteristics of equity
  • Conceptual Framework
  • Leases
  • Disclosure initiative
  • Equity method of accounting


Friday, 27 March 2015 (9:00-16:30)

  • Insurance contracts
  • Post-implementation review of IFRS 3
  • IFRS 15 Revenue from Contracts with Customers
  • Business combinations under common control
  • Review of the Accounting Standards Advisory Forum
  • Current projects and feedback

Agenda papers for the meeting are available on the IASB's website.

February 2015 IASB meeting notes posted — Part I

20 Feb 2015

The International Accounting Standards Board (IASB) met at its offices in London on 18–20 February 2015, some of it a joint meeting with the FASB. We have posted the Deloitte observer notes from the sessions on the IFRS for SMEs, rate-regulated activities, and leases. Additional notes will be posted in due course.

Click through for direct access to the notes:

Wednesday, 18 February 2015

Thursday, 19 February 2015

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

 

Roadmap for application of IFRS converged standards in India officially notified

20 Feb 2015

The Indian Ministry of Corporate Affairs (MCA) has officially notified the road map for the adoption of Indian Accounting Standards (Ind AS), which are largely converged with International Financial Reporting Standards (IFRSs).

The notification has been uploaded to the MCA website together with the thirty nine Ind AS. They will enter into force on 1 April 2015. Companies with a net worth of Rs. 500 crore or more will have to mandatorily follow Ind AS from 1 April 2016. Corporates having a net worth of less than Rs. 500 crore but are listed, or in the process of getting listed, and companies with a net worth of Rs. 250 crore or more will have to follow the new norms from 1 April 2017. However, the road map exempts banking, insurance and non-banking finance companies.

Ind AS are largely converged with IFRSs but not identical. In a recent speech, IASB Chairman Hans Hoogervorst called the new Ind AS "a very important stepping-stone on the path to adoption of IFRS" but also warned that stopping at convergence without in the end fully adopting IFRS might mean that India will not reap the full benefits of "impressive achievements".

Please click for additional information:

IASB and FASB discuss potential clarifications to joint revenue recognition guidance

20 Feb 2015

At their meeting on Wednesday, the IASB and FASB discussed issues that their joint revenue Transition Resource Group (TRG) has identified in connection with implementation of their converged standard, “Revenue From Contracts With Customers” (issued as IFRS 15 by the IASB and as ASU 2014-09 by the FASB). Specifically, the boards addressed whether to clarify certain aspects of the standard that seem to be causing implementation problems for some preparers.

Topics that one or both boards may consider revising or clarifying include de­ter­min­ing the nature of an entity’s promise in granting a licence of in­tel­lec­tual property, iden­ti­fy­ing per­for­mance oblig­a­tions related to the level at which promised goods or services are iden­ti­fied in a contract with a customer, evaluating whether promised goods and services are distinct, and de­ter­min­ing whether shipping and handling services are promised services in the contract or a ful­fil­lment cost.

For more information, see Deloitte’s 19 February 2015, Heads Up and the tentative boards decisions on the FASB's website.

EFRAG recommends postponing the endorsement process on IAS 28/IFRS 10 amendments due to an identified conflict with IAS 28

19 Feb 2015

The European Financial Reporting Advisory Group (EFRAG) has recommended to the European Commission to postpone the endorsement process on the amendments to IFRS 10 and IAS 28 regarding the sale or contribution of assets between an investor and its associate or joint venture until the IASB has addressed an identified conflict with IAS 28.

On 11 September 2014, the IASB issued Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (Amendments to IFRS 10 and IAS 28). Subsequently, EFRAG identified a conflict of the amendments with IAS 28 Investments in Associates and Joint Ventures and notified the IASB of the conflict. The IASB has acknowledged the conflict and discussed the issue at its January 2015 meeting. The Board members tentatively decided to:

  • clarify the requirements of IFRS 10 and IAS 28 to address the conflict;
  • to do so in the forthcoming ED on another amendment to IAS 28 regarding the elimination of gains or losses arising from transactions between an entity and its associate or joint venture; and
  • to propose a postponement of the effective date of the September 2014 amendments so that the effective date of the clarification to be included with the forthcoming ED and the September 2014 amendments are the same.

In light of these developments, EFRAG has recommended to the European Commission to postpone the endorsement process relating to the amendments to IFRS 10 and IAS 28 until the project on Elimination of gains or losses arising from transactions between an entity and its associate or joint venture is completed. Please click for the letter to the Commission on the EFRAG website. EFRAG has updated its endorsement status report accordingly.

IASB responds to EU Green Paper and states that the Capital Market Union would benefit from IFRSs

18 Feb 2015

The European Commission has launched a project to boost growth in the EU with the creation of a single market for capital. The 'Capital Markets Union' aims to break down the barriers that are blocking cross-border investments in the EU and preventing businesses from getting access to finance.

The Green Paper launched on 18 February 2015 states:

International Financial Reporting Standards (IFRS) have played a key role for promoting a single accounting language in the EU, making it easier for large listed EU companies to have access to global capital markets. Imposing full IFRS on smaller companies, in particular those wanting to access dedicated trading venues, would, however, be a source of additional cost.

The IFRS Foundation has responded to this statement:

A single set of financial reporting requirements can play a fundamental role in the creation of a CMU. [...] As business models, practice and markets change, the IASB works to ensure that financial reporting continues to meet the needs of market participants and has a number of continuing initiatives to improve the usefulness of financial statements produced by all companies.

Please click for additional information (external links):

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