The publication mainly consists of a non-exhaustive list of examples illustrating when IFRS Standards may require companies to consider the effects of climate-related matters in applying the principles in a number of standards.

The examples in the list refer to the following standards:

• IAS 1 Presentation of Financial Statements
• IAS 2 Inventories
• IAS 12 Income Taxes
• IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets
• IAS 36 Impairment of Assets
• IAS 37 Provisions, Contingent Liabilities and Contingent Assets and IFRIC 21 Levies
• IFRS 7 Financial Instruments: Disclosures
• IFRS 9 Financial Instruments
• IFRS 13 Fair Value Measurement
• IFRS 17 Insurance Contracts

The publication also notes that in addition to the specific requirements outlined in the table, IAS 1 contains some overarching requirements that could be relevant when considering climate-related matters.

In an article published in November 2019, IASB Board member Nick Anderson had already explained how IFRS requirements can be used to report on climate and other emerging risks.

Please click to access Effects of climate-related matters on financial statements on the IASB website.

The publication notes that companies can no longer afford to ignore what climate change means for their business as climate change is material and investors need visibility about the effects in company accounts. The group is therefore, not calling for sustainability disclosures or reports but for reflecting climate change effects in IFRS accounting. In an article published in November 2019, IASB Board member Nick Anderson had already explained how IFRS requirements can be used to report on climate and other emerging risks.

Investor Expectations for Paris-aligned Accounts sets out investor expectations in five clear steps companies can take in preparing ‘Paris aligned’ company accounts:

• An affirmation that climate risks are incorporated into the accounts;
• Adjustments to critical assumptions and estimates;
• Sensitivity analyses and their results linked to variations in judgements or estimates;
• Dividend resilience and implications for dividend paying capacity of Paris-alignment; and
• Confirmation of consistency between narrative reporting on climate risks and the accounting assumptions.

The publication also outlines specific investor expectations for auditors to call out where accounts are ignoring material climate risks; making it clear they should say when accounts are not ‘Paris-aligned’.

Where these expectations are not met, three courses of investor action are identified: engagement (engage with boards and audit committees to press for Paris-aligned accounting), vote (vote against reappointments where performance is inadequate) and divestment (sell shares in companies that fail to provide reliable 'Paris-aligned' accounts).

Please click to download Investor Expectations for Paris-aligned Accounts from the IIGCC website.

The two main topics for the meeting were:

• Practical implementation, including measurement, of core indicators for entity reporting on the contribution towards the attainment of the Sustainable Development Goals: Review of case studies
• Climate-related financial disclosures in mainstream entity reporting: good practices and key challenges

The keynote address on the second topic was given by Erkki Liikanen, Chair of the IFRS Foundation Trustees.

All presentations from the meeting (including the presentations from the workshop on "Assurance on sustainability reports: current practices and challenges“ on 30 October 2020) can now be accessed online and there are also recordings of all sessions.

Accountancy Europe especially raises points around the governance, structure and financing of the European Financial Reporting Advisory Group (EFRAG) that need to be considered if a standard-setter for non-financial information were to be established under the umbrella of EFRAG.

As before in its paper on interconnected standard-setting for corporate reporting, Accountancy Europe points out that standard-setting needs to follow the principles of legitimacy, independence, transparency, public accountability, due process, and balance and notes that:

Particularly, a multi-stakeholder involvement guarantees high quality and balanced standards; whereas independence affects the public perception of standard setting and resultantly, legitimacy.

Applying these principles to a possible standard-setter for non-financial information (NFI), the comment letter makes the following suggestions:

• setting up a new body within EFRAG to address NFI standards activities;
• providing adequate governance and oversight to the NFI standards activities body (distinct from the governance and oversight of the financial reporting activities);
• ensuring connectivity between NFI and financial activities within the EFRAG where appropriate;
• providing adequate governance and oversight of the EFRAG organisation as a whole;
• enlarging the EFRAG General Assembly;
• setting up a new NFI EFRAG Advisory Council; and
• reforming the EFRAG European Reporting Lab.

The comment letter also emphasises the other on-going initiatives in the field and especially notes the work of CDP-CDSB-GRI-IIRC-SASB as well as the IFRS Foundation consultation towards a comprehensive reporting system. Accountancy Europe proposes that EFRAG uses the NFI standards from these initiatives as a basis upon which to add regional (EU) requirements and only develops separate standards if it becomes clear that a global solution will not be timely available as broad market acceptance also depends on leveraging to the maximum possible the relevant work of recognised NFI frameworks and standards organisations.

On financing, the comment letter makes clear that that the more demands are put on EFRAG, the more human and financial resources will be needed. To this end, stable funding from both the private sector (financially and, in particular, in kind) and from the European Commission is required, both for the EFRAG ac­tiv­i­ties related to financial reporting and the ones related to the wider corporate reporting including NFI reporting.

Please click to access the full comment letter on the website of Accountancy Europe.

Please click to access the updated alignment dashboard prepared for the December 2020 IPSASB meeting on the IPSASB website.

Deloitte offers a summary of the provisions of all IPSAS in our IPSAS in your pocket publication.

The consultation is intended to assess demand for global sustainability standards and what role the Foundation might play in the development of such standards.

Please click for access to the recordings on the IASB website. The introductory part in both sessions is the same, the questions put forward by the audience differ.

At its October 2020 meeting, the Board decided unanimously to separate the PIR of the IFRS 9 classification and measurement requirements (including FVOCI equity instruments) from the PIR of the rest of IFRS 9 and to start the PIR on classification and measurement as soon as possible.

One argument brought forward for a separation of classification and measurement was that this part of IFRS 9 did not have a transition resource group (TRG) and thus application issues have not been addressed since publication of the standard. It was also noted that there is not much overlap between classification and measurement and the rest of IFRS 9, so the PIRs can be done separately.

Please see the press release on the IASB website for more information.

The Advisory Council is the formal advisory body to the Trustees and the IASB. It advises the IFRS Foundation on its strategic direction, technical work plan and priorities.

The new and reappointed members of the Advisory Council are:

• Kristian Koktvedgaard - BusinessEurope
• Sibel Ulusoy Tokgöz - Capital Markets Board of Turkey
• Thorsten Sellhorn - European Accounting Association (EAA)
• Javier de Frutos - European Federation of Financial Analysts Societies (EFFAS)
• Saskia Slomp - European Financial Reporting Advisory Group (EFRAG)
• Ken Warren - External Reporting (XRB), New Zealand
• Ron Edmonds - Financial Executives International (FEI)
• Ian Burger - International Corporate Governance Network
• Antonio Quesada - International Organization of Securities Commissions (IOSCO)
• Marie Seiller - International Organization of Securities Commissions (IOSCO)
• Alan Trotter - Investment Company Institute
• Henry Daubeney - Pricewaterhouse Coopers
• Barbara McGowan - World Bank
• Eduardo Flores
• Tania Wimberley 

All appointments take effect 1 January 2021 and are for a three-year period.

In addition, the Trustees note that the following members are stepping down from the Council at the end of 2020 or have already stepped down earlier this year: Areewan Aimdilokwong, Clive Brown, Garth Coppin, Jean Paul Gauzes, Professor Ann Jorissen, Ton Meershoek, Pam O'Connell.

The press release announcing the new appointments can be found on the IASB's website.

The IFRS Foundation disclosed this decision in its Coronavirus update.

The errors affect the stand-alone standards only.

Editorial corrections do not change the meaning or application of pronouncements, but instead correct inadvertent errors. The editorial corrections can be viewed on the editorial corrections page of the IASB's website.