This webcasts discusses the Board’s preferred approach and classification of non-derivative financial instruments.

Future webcasts in the series will cover:

• Clas­si­fi­ca­tion of de­riv­a­tives on own equity.
• Clas­si­fi­ca­tion of compound in­stru­ments and re­demp­tion oblig­a­tion arrange­ments.
• Pre­sen­ta­tion of equity in­stru­ments.
• Pre­sen­ta­tion of financial li­a­bil­i­ties.

For more information, see the press release on the IASB’s website and the webcast on the IFRS Foundation’s YouTube channel.

Key findings of the survey include:

Previously, Mr Liikanen has worked in various leadership positions which included serving as Governor of the Bank of Finland, Governor of the International Monetary Fund, and member of the Governing Council of the European Central Bank.

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

One of the questions in the fitness check relates to whether it is still appropriate that the IAS Regulation prevents the European Comission (EC) from modifying the content of IFRS as issued by the IASB. ESMA notes that the EC has only recently sought feedback on this question twice (2013 and 2015) and both times the great majority of stakeholders cautioned against introducing such a possibility. The letter adds:

In line with its prior positions, ESMA strongly disagrees with this recommendation, most notably because any European-specific adjustments to IFRS would defy one of the key objectives of the IAS Regulation, namely that financial reporting standards applied by listed issuers are accepted internationally and are truly global standards. In addition, we believe that modifications to IFRS at the European level would hinder the capacity of European companies to compete for financial resources on equal terms in global capital markets. In our view, the different levels of commitment to require IFRS as issued by the IASB around the globe is not a justification for introducing carve-ins. On the contrary, Europe should show leadership in reaffirming its commitment to IFRS. This in turn would increase its ability to influence the development of IFRS, which the EU should continue to actively do as part of the IASB’s due process. 

ESMA also states that the current endorsement criteria should not be changed as the current endorsement process already provides the necessary safeguards to the European public good, by providing the possibility for the non-endorsement of a standard, which is not conducive to European public good.

Please click to access the press release on the ESMA website, which offers a quick overview over ESMA's position as well as access to the letter of response and the completed questionnaire.

The 18 minute video Research and Standard setting—How to contribute to the IASB's work can be accessed here.

The decision strikes a balance between calls to delay the effective date to 2022 (mainly because it is considered to be burdensome to SMEs) and the wish to keep the effect on the banking industry in terms of investor confidence or credit ratings small as the deferral is just one year. Also, early adoption remains possible.

For more information please see the press release on the FAP website (in the Thai language only).

The consultation document, including proposed changes and indicative questions, can be downloaded here from the IVSC website.

Comments are requested by 16 October 2018.

The webinar provides background information, an overview of changes, supporting materials, and upcoming changes to the IFRS Taxonomy.

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

As reported earlier, the document seems oddly tilted against the use of IFRSs as issued by the IASB asking for example whether European listed companies are still best served by applying IFRS or whether the European Commission should be given the power to modify IFRSs as issued by the IASB. Accountancy Europe clearly warns against this. The response states:

It is still appropriate that the IAS Regulation prevents the Commission from modifying the content of IFRS. We call for great caution in permitting the EU to change specific aspects of IFRS standards published by the IASB ('carve-in') before transposing them into EU law.

The reasons the response cites are:

• Fear of an uncontrollable and unpredictable trend that would lead to EU-IFRS;
• isolating the EU from global capital markets would hinder investments (including long-term investments), create confusion, and increase the cost of capital;
• concerns regarding the current position of foreign private issuers in the US;
• decrease of EU influence on the international standard-setter, which would in turn make the issuance of international standards that do not meet the EU endorsement criteria more likely;
• loss of all benefits that result from international comparability and transparency.

As additional points on international financial reporting Accountancy Europe also states that listed entities without subsidiaries should also be required to apply IFRSs, the option to apply IFRSs should be available at company level (not member state level), the EU endorsement criteria should not be changed, and the IASB's Conceptual Framework should be endorsed for use in the EU.

Please click to access to the letter of response and the completed consultation questionnaire on the Accountancy Europe website.

The Exposure Draft of ASCG Interpretation (IFRS) No. 1 Accounting for Interest and Penalties Related to Income Taxes under IFRSs (ED ASCG Interpretation 1) addresses the accounting for interest and penalties related to taxes within the meaning of section 3(4) of the AO (Abgabenordnung, Fiscal Code of Germany) that relate to current income taxes within the meaning of IAS 12.5 (interest and penalties related to income taxes) in financial statements prepared in accordance with IFRSs, as adopted by the EU.

According to the Exposure Draft, interest and penalties related to income taxes shall be accounted for in accordance with IAS 37.

If an entity changes its accounting treatment because of this interpretation, the lack of previous guidance means that this does not constitute the correction of an error, but rather a change in accounting policy within the meaning of IAS 8.

Comments on the exposure draft are requested by 31 August 2018. The English language translation of the draft is available here on the ASCG website.