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Background papers for the 36th annual ISAR meeting

11 Oct 2019

The thirty-sixth session of the United Nations Conference on Trade and Development (UNCTAD) Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting (ISAR) will be held in Geneva on 30 October - 1 November 2019. The two main agenda items discussed during the session will be the practical implementation of core indicators for entity reporting and the contribution towards the attainment of the Sustainability Development Goals and a review of current developments in international standards of accounting and reporting in the public and private sectors.

For both agenda items, background notes have been prepared by the UNCTAD secretariat to facilitate deliberations. The papers can be downloaded from the UNCTAD website:

General information on the session including a provisional agenda for the meeting is available here.

Before the meeting, there will be a workshop on "Practical implementation of climate-related financial disclosures and their relationship to the SDGs" on 29 October 2019. More information is available here.

Further publication of interest in the context of the meeting are available on the UNCTAD website:

EFRAG conference on IFRS and regulation

10 Oct 2019

The European Financial Reporting Advisory Group (EFRAG) announces that they will will host a conference 'IFRS & Regulation: Searching for Common Ground' on 28 November 2019 in Brussels.

The conference will include a keynote speech from Michel Prada (former chairman of the IFRS Foundation Trustees and of the French regulator Autorité des Marchés Financiers) and two high-level panels on principles-based standards and regulation.

Please click for more information and registration details on the EFRAG website.

FRC publishes thematic review findings of IFRS 9, IFRS 15, and IAS 36 company disclosures

10 Oct 2019

The UK Financial Reporting Council (FRC) has published three thematic reviews to help companies improve the quality of their corporate reporting in relation to IFRS 9 'Financial Instruments', IFRS 15 'Revenue from Contracts with Customers' and the impairment of non-financial assets.

The reports analyse the disclosures in a sample of companies’ reports and provide examples of better practice.

The FRC concluded that IFRS 15 disclosures could be improved especially with respect to

  • improving the descriptions of accounting policies and ensuring that these are tailored to their own particular circumstances; and
  • providing more detailed information about the judgements significantly affecting the amount and timing of revenue.

In connection with IFRS 9 the FRC found that there was still room for companies to improve disclosures by

  • analysing the credit quality of trade receivables by non-banking companies; and
  • providing details of the indicators of a significant increase in credit risk particularly by the smaller banks.

As regards IAS 36 and the impairment of non-financial assets, the FRC encourage companies to pay greater attention to:

  • providing relevant information around significant judgements and key assumptions made in estimating the recoverable amount of assets and cash-generating units;
  • explaining the sensitivity to changes in key assumptions, where reasonably possible changes could give rise to impairment of goodwill or material further adjustments to already-impaired assets. 

Please click for the following additional information on the FRC website:

AASB research into user needs regarding parent/subsidiary financial reporting

10 Oct 2019

The Australian Accounting Standards Board (AASB) has published its Research Report No. 13 'Parent, Subsidiary and Group Financial Reporting'.

The research report assesses whether current financial reporting requirements for parent/subsidiary structures meet user needs in a cost-effective way.

The report concludes that users most dependent on general purpose financial statements in the for-profit sector are generally satisfied with summary financial information about parent entities which is currently required in the consolidated financial statements. However, they state that they need more information disclosed about subsidiaries in consolidated financial statements than is currently required, particularly if complete sets of subsidiary financial statements were to be no longer available to them. Some also state that they need to know whether other financial statements pertaining to group entities (including the group itself) exist and, where they do, those users need to see cross-references to them.

While the report is mainly intended to provide input to the process through which the AASB will work with regulators, users, preparers and other stakeholders in Australia, the users’ views on the additional disclosures needed will also provide important input to the IFRS 12 Disclosure of Interests in Other Entities post-implementation review of the IASB.

Please click to access the research report on the AASB website.

Agenda for the October 2019 DPOC meeting

09 Oct 2019

The Trustees of the IFRS Foundation will be meeting in New York from 15 to 17 October 2019. However, only the meeting of the Due Process Oversight Committee (DPOC) on 15 October will be held in public.

The agenda for the DPOC meeting is summarised below.

Tuesday, 15 October 2019 (10:45–12:20)

  • Introduction and actions from the DPOC meeting held on 25 June 2019
  • Technical activities: Key issues and update
  • Consultative Groups — annual review and DPOC engagement
  • Reporting Protocol — annual general report
  • Education material — review of due process
  • Review of the Due Process Handbook
    • Overview and finalising the amendments
    • Summary and analysis of feedback
    • Overview of comments received on agenda decisions
    • Overview and analysis of other comments received
  • Correspondence
  • Summary

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

IASB issues podcast on latest Board developments (September 2019)

07 Oct 2019

The IASB has released a podcast, featuring IASB Chair Hans Hoogervorst and Vice-Chair Sue Lloyd as well as communications team member Kasia Gilewska, to discuss the deliberations at the September 2019 IASB meeting and other developments.

The podcast features dis­cus­sions of the following topics in more detail (length of the podcast: 18 minutes):

  • World Standard-Setters Conference.
  • IFRS Advisory Council.
  • Financial in­stru­ments with char­ac­ter­is­tics of equity.
  • IBOR reform and its effects on financial reporting.
  • Business com­bi­na­tions under common control.
  • Agenda consultation.

The podcast can be accessed through the press release on the IASB website. More in­for­ma­tion on the topics discussed is available through our com­pre­hen­sive notes taken by Deloitte observers at the September IASB meeting.

EFRAG draft comment letter on proposed amendments to IAS 1 and the Materiality Practice Statement

04 Oct 2019

The European Financial Reporting Advisory Group (EFRAG) has issued a draft comment letter on the IASB exposure draft ED/2019/6 'Disclosure of Accounting Policies (Proposed amendments to IAS 1 and IFRS Practice Statement 2)'.

The proposed amendments are intended to help preparers in deciding which accounting policies to disclose in their financial statements.

EFRAG supports the proposal to replace the undefined reference to 'significance' with the defined concept of 'materiality'. EFRAG believes that this, with other Disclosure Initiative projects, may help entities to identify and disclose accounting policies that provide material information to users and the connection to the application of materiality to other information. However, EFRAG notes the possible inconsistencies of the proposed guidance with the existing disclosure requirements in IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors regarding accounting policies choices and changes.

Comments on EFRAG's draft comment letter are requested by 22 November 2019. For more information, see the press release and the draft comment letter on the EFRAG's website.

Sixth IASB Research Forum — papers available

03 Oct 2019

The International Accounting Standards Board (IASB) in conjunction wit the Journal of International Accounting Research (JIAR) will host its sixth research forum on 28–29 October 2019 in Short Hills, New Jersey. The papers to be presented and discussed are now available on the IASB website.

The forum will see the pre­sen­ta­tion of four academic papers, followed either by a response of an academic and an IASB/NNS rep­re­sen­ta­tive or by a panel dis­cus­sion. In both cases, the audience will be invited to par­tic­i­pate in the dis­cus­sion. The papers are the following (all links to the IASB website):

Report on the September 2019 IFRS Advisory Council meeting

03 Oct 2019

A summary report has been released of the meeting of the IFRS Advisory Council held in London on 18–19 September 2019.

The participants discussed:

  • Effect of technology on the investment process — Council members advised on the impact technology have on the need for IFRSs and the IFRS Taxonomy in the future and whether market forces are supplanting benefits of an IFRS Taxonomy.
  • Consistent adoption and application of IFRSs — Council members considered to what extent the IFRS Foundation should refresh its approach to monitoring consistent adoption and application.
  • Effective risk management — Council members generally agreed with the risks that had been identified by the Foundation. However, there was a suggestion that risks around financing should be considered for inclusion.
  • Update on Trustees and Foundation activities and Update on the Board’s activities — Council members received updates on recent trustee activities and on recent activities of the Board and the IFRS Foundation.
  • Digital experience for customers and stakeholders — Council members considered how the Foundation’s digital experience should evolve, what developments should be prioritised over the next three years and who the Foundation learn can from.
  • 2020 Agenda Consultation — Proposed approach — The majority of council members supported the proposal to include a shortlist of potential projects and some form of preliminary Board thoughts on the topics, rather than the Board’s full preliminary views of which potential projects from the shortlist it proposes to add to its work plan.

The full meeting summary is available on the IASB's website. There are also recordings of the individual sessions.

Paper on climate-related risk and financial statements

03 Oct 2019

The Australian Accounting Standards Board (AASB) has announced the availability of a paper 'Climate-related Risk and Financial Statements: Implications for Regulators, Preparers, Auditors and Users'.

The AASB recently published published the bulletin Climate-related and other emerging risks disclosures: assessing financial statement materiality using AASB Practice Statement 2, with AASB Practice Statement 2 being essentially the same as the IASB Practice Statement on Materiality. The paper now released provides an outline of the guidance in the practice statement and motivation behind the issuance of the bulletin on climate‐related risk disclosures, key takeaways and recommendations, and the AASB's suggestions on the type of evidence that would be useful for standard-setters.

Climate-related Risk and Financial Statements: Implications for Regulators, Preparers, Auditors and Users was published in the Australian Accounting Review and can be accessed free of charge in the Wiley Online Library.

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