Three years after publication of the International Integrated Reporting Framework, the International Integrated Reporting Council (IIRC) has announced a two-month consultation to gauge businesses' views on the implementation of the framework, to inform on further development. Feedback is being sought from those involved with preparing integrated reports, providers of financial capital and other users of integrated reports, as well as policy makers, regulators, standard-setters, assurance providers and academics. More information is available on the IIRC website.

The UK Financial Reporting Council (FRC) has responded to the consultation document of the Task Force on Climate-related Financial Disclosures (TCFD) with recommendations on climate-related disclosures. The FRC supports the publication of the proposed disclosures as a stimulus to develop thinking and practice in this area, and as a tool to help companies identify the most appropriate disclosures for them to make. However, it believes that a list of suggested disclosures may risk companies adopting a checklist mentality and boilerplate approach. The FRC is also concerned that the size, complexity and detail of the recommendations may impair their usefulness. More information is available through the press release on the FRC's website.

The Sustainability Accounting Standards Board (SASB) has also responded to the TCFD's consultation document. The SASB supports the general climate risk framework and makes several recommendations to streamline and strengthen it. It supports the four core elements of disclosure, but has recommendations to reduce redundancies and improve usefulness. On implementation, the SASB requests that the TCFD provide more guidance related to its vision of the implementation of its recommendations. Furthermore, the SASB believes that clarification on the materiality basis for the disclosures is needed. The response also provides a summary of actions the SASB plans to take to determine how to align SASB’s standards with the TCFD recommendations. Please click for access to the response on the SASB website.

The IFRS Interpretations Committee will deliberate comment letters received on issues regarding IAS 19 and IFRS 11, finalise agenda decisions on IAS 2, IAS 12, IAS 28, and IFRS 10, and consider new issues on IAS 12, IAS 19, IAS 32, IAS 33, IAS 41, IFRS 1, and IFRS 9.

The full agenda for the meeting can be found here. We will update this page for any changes to the agenda and our Deloitte pre-meeting summaries and observer notes from the meeting as they become available.

Foreign private issuers may begin to submit their financial statements in XBRL immediately and will be required to do so for fiscal periods ending on or after 15 December 2017. As stated by SEC Acting Chairman Michael Piwowar, the use of the IFRS Taxonomy for IFRS financial statements “will enable the public to take advantage of enhanced data analysis of those financial statements, as they already can with financial statements of issuers that prepare their financial statements in accordance with U.S. accounting standards.”

For more in­for­ma­tion, see the press release and notice on the SEC’s website.

The topic was introduced by the IFASS Chair Liesel Knorr. She focused on the work of the IFRS Interpretations Committee (as pars pro toto of the IASB's work) and its role within consistent application. She noted that according to the Due Process Handbook the role of the Committee was to address issues that have widespread and/or material effect. As examples she mentioned negative agenda decisions from the November 2016 IFRIC Update. For the strategy discussion Ms Knorr pointed out that "widespread" as well as "material" could have a local meaning as well as an international one and brought up the question of what the role of the standard-setters should be in case of negative agenda decisions even though the issue was widespread or material at least in some jurisdictions. In the context of consistency, should they conclude that the IFRS IC accepted diversity in practice? Also, should they enforce the opinions reflected in negative agenda decisions? Overarching the whole discussion was the question of what constitutes consistency - identical treatment or comparable results?

The issue was discussed in small groups and afterwards the results were presented and discussed in the plenum. The main messages that emerged from the discussion were:

• General results:
  IFRS are principles-based, therefore consistent does not mean identical, rather, identical treatment is a significant feature of a rules-based system;
• Users have a tolerance for different readings of the same principles as long as there are sufficient disclosures, however, application of the same principle with different results that leads to different investor decisions might point at a problem and should be raised;
• Within an entity consistency should come with the meaning of "identical treatment";
• Consistency cannot be achieved by the IASB and/or the national standard-setters alone, it is the result of the IASB, the national standard-setters, the regulators, the auditors, and the preparers interacting;
• It is important to draw clear lines between education, implementation, and interpretation.

National standard-setters:

• National standard-setters can raise gaps or inconsistencies within standards with the IASB;
• Local interpretation should be kept to an utmost minimum, however, it would be better to work with the national regulators than letting them issue interpretations on their own;
• Field testing is an important role of standard-setters and can help identify possible jurisdictional issues;
• Raising awareness is an important role of standard-setters, especially for entities that don't have the resources for following developments closely;
• National standard-setters should be the gate keepers for submitting issues to IFRS IC.

IASB:

• The IASB and the IFRIC should come out more quickly with results, keeping a balance between timeliness and quality;
• The practice of moving issues back and forth between the IASB and IFRS IC should be discontinued;
• The IFRS IC should meet more frequently;
• If the Committee thinks that a problem is not widespread it should publish the data supporting this assessment;
• Agenda rejections should be clearer, sometimes just limiting options can already be helpful;
• As agenda decisions do not contain transition guidance, they can be difficult to apply.

IFASS

• IFASS is not an interpretative body;
• IFASS meetings will continue to offer a slot for discussing issues identified by individual standard-setters;
• In addition to the meetings, IFASS should find ways to communicate more often, maybe by teleconference or by written exchange.

The two major unanimous conclusions that "consistent" does not mean "identical" and that local interpretations are not desirable led to the question of how to take the topic further. In addition to communicating the results and the recommendations regarding the IASB's work to the IASB (that was represented at the meeting by Vice IASB Chair and IFRS Interpretation Committee Chair Sue Lloyd), the IFASS agreed to set up structures for collecting issues identified by the standard-setters, possibly by means of a database, if possible joined with or related to the IASB's inquiry database, so that standard-setters can see whether issues they identify have already been encountered in other jurisdictions and/or raised with the IASB. The group will also look into possibilities of communicating between meetings. A small working group will develop possible solutions and introduce them to IFASS at the fall meeting.

At a later point during the meeting, the IASB representative replied by acknowledging that the discussion had provided valuable insights and that the IASB would definitely try to take them on board in its work. She also noted that there seemed to be the perception that the IFRS IC was not very active, therefore she presented statistics that showed that in 2016 the Committee had discussed 33 issues, 25 of which had been addressed (addressed issues include negative agenda decisions). The IASB also outlined intended improvements to existing processes especially in the area of communication and noted that it encourages the discussion of practice issues among national standard-setters.

The above summary is based on our observer notes from the meeting. The IFASS will provide a summary of all topics discussed at the meeting in due course.

Mr Kabureck noted that the IASB would begin addressing non-GAAP earnings measures in its research project on primary financial statements. However, he stated that “[t]he challenge for us is to put some order and structure into the reporting of financial performance while simultaneously providing relevant information that faithfully represents the performance of the company.” Some of the challenges include EBIT, income before non-recurring items, income from core operations, and operating profit. Next, he provided three possible philosophical approaches when determining the composition of an alternative performance measure. These approaches included:

• Explicit requirements for composition.
• Managerial approach similar to segment reporting.
• Principles-based approach.

Finally, he discussed accounting policy disclosures that are being considered by the IASB.

For more in­for­ma­tion, see the article on the IASB’s website.

The provisional agreement was dependent on the EFRAG’s ability to implement certain governance reforms recommended in the Maystadt report and will need to be confirmed by the Council and the European Parliament before it becomes official.

For more information, see the press release on the EFRAG’s website.

In addition, the podcast features (1) updates on the recent meeting between the IASB, IFRS Foundation Trustees, and the IFRS Foundation Monitoring Board, (2) feedback on the proposed changes to the definition of a business consultation, (3) discussion on rate-regulated activities, (4) symmetric prepayment options comment period, and (5) sweep issues discussion on the new insurance contracts.

For more information, see the press release on the IASB website as well as our comprehensive notes taken by Deloitte observers of the February 2017 meeting.

The advisory panel will provide “expert advice on EFRAG’s research project to investigate possible improvements to the current requirements in relation to pension plans where the promised benefit is linked to the return on specified assets.” The composition is as follows:

• Nicklas Grip, Chairman, EFRAG TEG Vice-Chairman
• Vincent Caire, preparer
• André Geilenkothen, industry
• Selim Gogus, user
• Heinz Hense, EFRAG TEG member
• Patrice Kalfon, consultant
• Anne Laning, industry
• Gabriel van de Luitgaarden, preparer
• Kazim Razvi, user
• Geert De Ridder, auditor
• Jean-François Vaccaro, preparer
• Julián Villanueva Lara, user

In addition, observer status has been granted to the European Commission, the European Insurance and Occupational Pensions Authority, the European Securities and Market Authority, and PensionsEurope.

For more information, see the press release on the EFRAG’s website.

Below is an analysis of all changes made to the work plan since the last update in January 2017.

Stan­dard-set­ting and related projects

• Insurance contracts — the expected issuance of the IFRS is now marked as being expected within the next three months (May).

Nar­row-scope amend­ments

• Im­prove­ments to IFRS 8 resulting from the post-im­ple­men­ta­tion review of IFRS 8 — the expected pub­li­ca­tion of an exposure draft is now expected in March. Previously, it was expected in April.

IFRS Taxonomy

• Taxonomy update on insurance contracts — The expected issuance is now marked as being expected within the next three months (May).
• Common practice (agriculture, leisure, franchises, retail and financial institutions) — This project has completed its public consultation phase and is now in the drafting phase.

The revised IASB work plan is available on the IASB's website.

Meeting ac­tiv­i­ties included the following:

• Updates on technical ac­tiv­i­ties — The DPOC was presented with a report that outlined the due process ac­tiv­i­ties for all projects on the IASB’s current agenda. Specif­i­cally, the DPOC discussed the due process activities taken as part of the upcoming insurance contracts standard, which included an effects analysis and implementation activities.
• Research agenda including due process on the share-based payment project — The DPOC was presented with the IASB’s research programme, the share-based payments research project, and the basis on which projects make it to the Board’s work plan.
• Materiality practice statement — The DPOC confirmed that the requirements of the Due Process Handbook have been met.
• IFRS 9 Financial Instruments (narrow scope amendment) — The DPOC agreed to allow an exposure draft for narrow-scope amendment to IFRS 9 to proceed with a 30-day comment period.
• IFRS Taxonomy Consultative Group (ITCG): Terms of reference — The DPOC agreed to adjust the ITCG’s charter concerning ITCG member terms and approved the reappointment of the ITCG Chair and Vice-Chair.
• Cor­re­spon­dence — No new cor­re­spon­dence has been received since the DPOC’s previous meeting.

The full report on the DPOC meeting is available on the IASB’s website.