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January

Agenda for the January 2019 DPOC meeting

23 Jan 2019

The Trustees of the IFRS Foundation will be meeting in Kuala Lumpur from 29 to 31 January 2019. However, only the meeting of the Due Process Oversight Committee (DPOC) on 29 January will be held in public.

The agenda for the DPOC meeting is summarised below.

Tuesday, 29 January 2019 (16:25–17:50)

  • Introduction and Actions from DPOC meeting held on 15 October 2018
  • Technical activities: Key issues and update
  • IBOR Reform – Comment letter period for potential narrow-scope amendments
  • Due Process Handbook review
    • Outline of timetable and next steps
    • Explanation of amendments to the Handbook
    • Agenda decisions
    • Effects analysis
    • Education material
  • Correspondence: update
  • Summary

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

Agenda for the upcoming IASB meeting changed

22 Jan 2019

The agenda for the IASB meeting, which will be held on 23 January 2019 in London, has been changed: The sessions have changed their order - most notably the session on IFRS 17 'Insurance Contracts' has been moved to the afternoon and will now begin at 13:00hrs UK time.

We have updated our meeting note page, which offers access to the agenda and our pre-meeting summaries of the agenda papers to be discussed, accordingly.

FRC Lab report on artificial intelligence in corporate reporting

22 Jan 2019

A new report from the Financial Reporting Lab of the UK Financial Reporting Council (FRC) considers how technology might impact the production, distribution and consumption of corporate reporting.

The report explains what artificial intelligence (AI) is, where its use might make sense in corporate reporting, and explores some of the possible and current use cases for the technology. For each use case it considers what is currently being achieved and what might be achieved in the future. The report finds:

  • Production – AI can enhance efficiency by replacing mechanistic human processing of underlying transactions and transforming that data into accounting and management information; ultimately feeding into annual reports.
  • Distribution – AI can support auditors and boards in the internal and external validation processes needed to ensure that the annual report is credible and compliant in an efficient and effective way.
  • Consumption – Investors are already using AI to enhance effectiveness of investment analysis by extracting meaning and value, not only from company reporting, but also from various sources of alternative data.

Overall, the report concludes hat it is not a question of whether AI will become important for corporate reporting, but when.

Please click to access Artificial Intelligence – How does it measure up? on the FRC website.

Additional educational module on the IFRS for SMEs on related party disclosures

22 Jan 2019

The IFRS Foundation has issued an additional new stand-alone educational module, which supports the learning, application, and reading of financial statements prepared with the IFRS for SMEs Standard.

The module focuses on the presentation of related party disclosures in the financial statements applying Section 33 Related Party Disclosures of the IFRS for SMEs.

Please click to access all 30 IFRS for SMEs modules available so far (free registration required).

IOSCO statement on disclosure of ESG matters by issuers

21 Jan 2019

The International Organization of Securities Commissions (IOSCO) has published a statement setting out the importance for issuers of considering the inclusion of environmental, social and governance (ESG) matters when disclosing information material to investors' decisions.

The statement notes that IOSCO Principle 16 states that issuers should provide full, accurate, and timely disclosure of financial results, risk, and other information which is material to investors’ decisions. In this context, the IOSCO statement emphasises that ESG matters, though sometimes characterised as non-financial, may have a material short-term and long-term impact on the business operations of the issuers as well as on risks and returns for investors and their investment and voting decisions. Therefore, statement notes:

IOSCO encourages issuers to consider the materiality of ESG matters to their business and to assess risks and opportunities in light of their business strategy and risk assessment methodology. When ESG matters are considered to be material, issuers should disclose the impact or potential impact on their financial performance and value creation. In doing so, issuers also are encouraged to give insight into the governance and oversight of ESG-related material risks.

Please click to access the full statement on the IOSCO website.

Additional educational modules on the IFRS for SMEs on investment property and revenue

18 Jan 2019

The IFRS Foundation has issued two new stand-alone educational modules, which support the learning, application, and reading of financial statements prepared with the IFRS for SMEs.

The modules focus on the requirements for accounting and reporting of investment property and of revenue applying the following sections of the IFRS for SMEs:

  • Section 16 Investment Property
  • Section 23 Revenue

Please click to access all 29 IFRS for SMEs modules available so far (free registration required).

Pre-meeting summaries for the January IASB meeting

17 Jan 2019

The IASB will meet at its offices in London on Wednesday 23 January 2019. We have posted our pre-meeting summaries for the meeting that allow you to follow the IASB’s decision making more closely. For each topic to be discussed, we summarise the agenda papers made available by the IASB staff and point out the main issues to be discussed by the IASB and the staff recommendations.

The Board will continue to assess concerns and implementation challenges raised by stakeholders about the requirements in IFRS 17 Insurance Contracts. At this meeting the Board will consider four issues: insurance acquisition cash flows for renewals outside the contract boundary; reinsurance contracts held—onerous underlying insurance contracts; reinsurance contracts held—underlying insurance contracts with direct participation features; and recognition of the contractual service margin in profit or loss in the general model. In all cases the staff is recommending that the Board propose amendments to IFRS 17.  

The staff is recommending that the Board proceed with the publication of an Exposure Draft to amend IAS 12 Income Taxes, in relation to the deferred tax on assets and liabilities arising from a single transaction. 

The staff will also give oral updates on the projects on Rate-regulated Activities and Extractive Activities.

More information

Our pre-meeting summaries are available on our January meeting note page and will be supplemented with our popular meeting notes after the meeting.

Forum on integrated thinking at the World Economic Forum in Davos

17 Jan 2019

While sustainable profit flows from the pursuit of a broader social purpose, translating it into something that is measurable in as simple and understandable way as we measure profit is not a small challenge. Metrics that explain this remain the ‘soft underbelly' of corporate communications.

Among Deloitte's WEF Davos activities is therefore a breakfast forum on Inclusive Capitalism on Thurday 24 January from 7:30 to 8:30 CET.

Panellists Mary Shapiro (Bloomberg/SASB Foundation), Mark Hawkins (Salesforce), Nils Bolmstrand (Nordea Asset Management AB), and Jessica Fries (A4S) will discuss how capital market participants can come together to make the world's financial systems more resilient for achieving sustainable value creation and long-term societal well-being. The discussion will be chaired by Deloitte's Global Chairman David Cruickshank.

Please click for more information on Deloitte's WEF Davos activities including the breakfast forum. All livestream events can be followed through Twitter and Facebook. and the events will also be available for subsequent playback.

IFRS Interpretations Committee holds January 2019 meeting

17 Jan 2019

The IFRS Interpretations Committee met via video and audio conference call on Wednesday 16 January 2019. We have posted Deloitte observer notes for the technical issues discussed during this meeting.

Agenda decisions to finalise

The Committee decided to finalise four tentative agenda decisions:

  • IAS 37 Provisions, Contingent Liabilities and Contingent Assets: concluding that a voluntarily payment made by an entity to a tax authority in relation to a disputed assessment (to avoid possible penalties or interest) is an asset
  • IFRS 15 Revenue from Contracts with Customers: concluding that fees for admitting an entity to a stock exchange and fees for an ongoing listing service relate to only one service
  • IAS 27 Separate Financial Statements: concluding that when an entity loses control of a subsidiary as a result of disposing some of its interest, an entity can elect to measure the retained interest at FVOCI and any gain or loss on initial disposal is presented in profit or loss
  • IAS 27 Separate Financial Statements: concluding that the cost of a subsidiary acquired in stages can be either the fair value of the tranches (as deemed cost) or the sum of the consideration actually paid

The final agenda decisions, which set out the particular circumstances that led to these conclusions, will be published in IFRIC Update.

Other work in progress

The Committee will discuss feedback on tentative agenda decisions in relation to the application of the highly probable requirement in a cash flow hedge relationship and the recognition of a lease liability by a joint operator at a future meeting.  

The staff are working on potential amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates to provide more guidance when a spot exchange rate is not observable.

The staff are analysing requests in relation to (a) whether an entity applies IFRS 16 Leases or IAS 38 Intangible Assets to a contract that gives it rights to space below the ground for a period of time; and (b) whether the right to potential discounts affects the classification of an entity’s pension plan as defined benefit or defined contribution.

More information

Please click to access the detailed notes taken by Deloitte observers for the entire meeting.

Additional educational modules on the IFRS for SMEs on provisions and contingencies and on employee benefits available

16 Jan 2019

The IFRS Foundation has issued two new stand-alone educational modules, which support the learning, application, and reading of financial statements prepared with the IFRS for SMEs Standard.

The modules focus on the requirements for accounting and reporting of provisions and contingencies and of employee benefits applying the following sections of the IFRS for SMEs:

  • Section 21 Provisions and Contingencies
  • Section 28 Employee Benefits

Please click to access all 27 IFRS for SMEs modules available so far (free registration required).

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