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2017

IPSASB podcast and Q&A document on materiality

23 Jun 2017

The International Public Sector Accounting Standards Board (IPSASB) staff have issued a podcast and a questions and answers document on the application of materiality to preparing financial statements.

Both documents explain the accounting requirements for materiality in International Public Sector Accounting Standards (IPSAS).

Please click to access the podcast and the Q&A document on the IPSASB website.

ASBJ publishes proposed amendments to 'Japan’s Modified International Standards'

23 Jun 2017

The ASBJ has issued JMIS Exposure Draft No. 4 'Proposed amendments to Japan’s Modified International Standards (JMIS): Accounting Standards Comprising IFRSs and the ASBJ Modifications'.

For this round the ASBJ undertook the endorsement process mainly on IFRS 15 Revenue from Contracts with Customers. The ASBJ additionally undertook the endorsement process on the amendments to IFRS 12 included in Annual Improvements to IFRS Standards 2014-2016 Cycle, because they were effective for annual periods beginning on or after 1 January 2017 and therefore their prompt endorsement was considered necessary.

The ASBJ’s future policy for the endorsement process on standards issued by the IASB will be to undertake the process individually for major standards, such as IFRS 9 Financial Instruments, IFRS 16 Leases, and IFRS 17 Insurance Contracts. Other amendments will continue to be, to the extent possible, covered in half-year batches.

Please click for access to all relevant documents on the ASBJ website (all documents available in the English language).

Academic workshop on measurement in financial reporting

23 Jun 2017

The European Financial Reporting Advisory Group (EFRAG) invites academics to join a workshop on measurement in financial reporting and the challenges and objectives connected with it in Brussels on 5 September 2017.

The objective of the workshop is to debate ideas on some of the main issues around measurement (e.g. uncertainty and discounting) and how these can be investigated. Participation in the workshop is free-of-charge but restricted to academics.

Please click for more information on the EFRAG website.

IFRS Foundation Trustees seek to fill Advisory Council vacancies

23 Jun 2017

The Trustees of the IFRS Foundation are calling for candidates to fill vacancies occurring at the end of 2017 for membership to the IFRS Advisory Council.

The terms of 16 current members are completed on 31 December 2017. Of those 16 current members, 12 are eligible for reappointment. New members would serve two or three-year terms, starting on 1 January 2018, renewable once.

Please click for the full advert on the IASB website.

IASB posts webinar on IFRS 17

21 Jun 2017

The IASB has posted to its website a webinar on the recently issued standard IFRS 17 'Insurance Contracts'.

The webinar — hosted by insurance contracts team members Joanna Yeoh and Andrea Pryde — discusses the scope of IFRS 17.

The webinar and slides are available on the IASB's website.

IASB updates agenda for June 2017 meeting

20 Jun 2017

The IASB has updated the agenda for its 21–22 June 2017 meeting. Wednesday's meeting time was shortened, the order of topics changed, and — most notably — the discussion on materiality was moved to the Board's July meeting.

The IASB has also changed its work plan to indicate Q3 2017 for (1) the ED on the definition of materiality (formerly September 2017) and (2) the practice statement on materiality (formerly H1 2016).

The full agenda for the June meeting can be found here. We will post any updates to the agenda, our comprehensive pre-meeting summaries as well as observer notes from the meeting on this page as they become available.

IASB publishes proposed amendments to IAS 16 regarding proceeds before intended use

20 Jun 2017

The International Accounting Standards Board (IASB) has published an exposure draft 'Property, Plant and Equipment — Proceeds before Intended Use (Proposed amendments to IAS 16)' on proceeds from selling items produced while bringing an asset into the location and condition necessary for it to be capable of operating in the manner intended by management. Comments are requested by 19 October 2017.

 

Background

The issue was initially raised with the IFRS Interpretations Committee that had origianally intended to develop an interpretation of IAS 16 Property, Plant and Equipment to deal with it. However, during the course of discussions the Committee concluded that a narrow-scope amendment to IAS 16 would be a better solution.

 

Suggested changes

ED/2017/4 Property, Plant and Equipment — Proceeds before Intended Use (Proposed amendments to IAS 16) proposes to amend IAS 16 to prohibit deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while bringing that asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Instead, an entity would recognise the proceeds from selling such items, and the cost of producing those items, in profit or loss.

 

Effective date

The exposure draft does not contain a proposed effective date which the IASB intends to decide on after the exposure. Nevertheless, the IASB has already concluded that earlier application would be permitted.

 

Additional information

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ICAEW report on corporate reporting and new technologies

14 Jun 2017

The Institute of Chartered Accountants in England and Wales (ICAEW) has released a report 'What next for corporate reporting: time to decide?' that argues that it is time for policy makers to take a decision on how best to use IT to satisfy increasing demands for information.

The report makes the following points:

  • Traditional paper-based reporting is still perceived by many as the principal form of communication.
  • There are increasing demands for a range of information to be provided in corporate reports and companies seem willing to provide it.
  • This leads to fears that the traditional reports are becoming too long (information overload) and therefore less useful.

ICAEW suggests that inclusion of digital and technology specialists in reporting discussions could highlight opportunities for companies to use technology in reporting as part of the solution to this problem, which might consist of presenting additional information outside of the annual report, in a digital format that is user-friendly and easy to access.

ICAEW believes that it would important to address these problems as soon as possible as the demand for more access to information is likely to continue to grow. However, ICAEW also notes that there needs to be further research into the implications of digitalisation and that key policy decisions on the issues would need to be taken if real progress is to be made in advancing the quality of corporate reporting.

The full report can be found on the ICAEW website.

Report on the April 2017 IFRS Advisory Council meeting

14 Jun 2017

The IFRS Advisory Council met in London on 4–5 April 2017. Significant topics on the agenda included (1) financial stability and the IFRS Foundation, (2) wider corporate reporting, and (3) materiality.

The report — prepared by the Chair of the IFRS Advisory Council, Joanna Perry — notes the following discussions:

  • Financial stability and the IFRS Foundation — Members of the Council received a presentation from the Secretary General of the Financial Stability Board. The presentation and ensuing discussion related both to a macroeconomic perspective of financial stability and to the key role of financial reporting standards as a foundation of financial stability. Members of Council then considered in breakout groups some key questions around the role of the IFRS Foundation in financial stability. One of the key messages to emerge was that financial stability is a byproduct of financial reporting and not the main objective.
  • Wider corporate reporting — The Council advised that it should be acknowledged that wider corporate reporting is becoming more important and that there is a role for the Board in this area although that role is not yet clear. There was broad support and encouragement for the Board to both undertake further research to obtain more information and to work with another body to consider further the role that the Board can play.
  • Materiality — Advice on the communications strategy for the Materiality Practice Statement included that the Board should be cognisant of the significant extent to which financial statements are likely to require revision as a result of the practice statement and should consider the communications strategy as a promotion and marketing exercise.

The next meeting of the IFRS Advisory Council is scheduled for 17–18 October 2017, in London. The full report on the council’s April meeting is available on the IASB's website.

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