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November 2019 IASB meeting notes posted

  • IASB meeting (blue) Image

26 Nov 2019

The IASB met on 19–20 November 2019 to discuss seven topics. We have posted our comprehensive Deloitte observer notes for all projects discussed during the meeting.

Amendments to IFRS 17 Insurance Contracts: In June 2019 the Board issued ED/2019/4 Amendments to IFRS 17. The staff summarised the feedback from the comment letters on the ten questions in the ED and summarised comments on areas for which amendments to IFRS 17 were considered but not proposed. The Board supported the staff’s plan for redeliberations.

Implementation matters:

  • Lack of Exchangeability (IAS 21): In June 2019, the IFRS Interpretations Committee discussed the difficulties in applying IAS 21 when a currency suffers from an extreme long-term lack of exchangeability and when a foreign operation has not been able to access foreign currencies using the available legal exchange mechanisms, such as with the Venezuelan Bolivar. The Board concluded that this matter is widespread, could have a material effect on those affected and it is necessary to amend IAS 21 to address the matter.  
  • Annual Improvements: The Board published ED/2019/2 Annual Improvements to IFRS Standards 2018–2020 in May 2019. The Board discussed the comments received: Subsidiary as a First-time Adopter (Amendment to IFRS 1); Fees Included in the ‘10 per cent’ Test for Derecognition of Financial Liabilities (Amendment to IFRS 9); Lease Incentives (Amendment to Illustrative Examples accompanying IFRS 16); Taxation in Fair Value Measurements (Amendment to IAS 41).
  • Cryptoassets: The Board was given updated information the staff has obtained by monitoring developments on holdings of cryptocurrencies or initial coin offerings and decided that the staff should continue to monitor developments.

Primary Financial Statements

During the drafting of the ED to replace parts of IAS 1, the staff concluded that it did not have sufficient guidance from the Board on how gains and losses from disposal or impairment of integral associates and joint ventures should be classified. The Board decided that they should be presented together with the share of profit or loss, and impairment losses and reversal of impairment, from those investments.

IFRS 3 reference to the Conceptual Framework: In May 2019, the Board published ED/2019/3 Reference to the Conceptual Framework, which proposed amendments to IFRS 3. The Board discussed the comments received. All respondents supported updating the references in IFRS 3, albeit with some disagreement about aspects of the ED. No decisions were made, although several Board members emphasised that out of scope items identified by respondents should not compromise the project timeline.

Management Commentary: The Board decided to include guidance in the revised Practice Statement about an entity’s business model.

Disclosure Initiative: The Board continued looking at the disclosure requirements in IAS 19 and IFRS 13. In particular it decided to propose changes to those Standards so that some requirements use prescriptive language (shall) and others use less prescriptive language (such as ‘shall consider’ or ‘will normally disclose’).

Subsidiaries that are SMEs: The objective of this project is to consider providing disclosure relief for subsidiaries that are SMEs. The Board decided that the project proceed based on the original scope (i.e. considering only subsidiaries that are SMEs) but consider later whether the scope can be expanded without significantly affecting the conclusions already reached.

IBOR Reform and the Effects on Financial Reporting: The October papers stated that the staff would bring the hedge accounting issues arising in Phase 2 for discussion with the Board at this meeting. That discussion was not on the November agenda.

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

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