A summary of the agenda is set out below:

Comment letters on tentative agenda decisions

IFRS 17 Insurance Contracts and IAS 21 The Effects of Changes in Foreign Exchange Rates—Multi-currency Groups of Insurance Contracts: In June 2022, the Committee published a tentative agenda decision in response to a submission about how to account for insurance contracts that generate cash flows in more than one currency. Most of the respondents agreed (or did not disagree) with the Committee’s conclusion regarding the identification of portfolios of insurance contracts. 11 out of 18 respondents agreed (or did not disagree) with the Committee’s conclusions regarding the measurement of a multi-currency group of insurance contracts and 7 respondents expressed concerns that an entity could develop a multi-currency accounting policy. The Committee decided to finalise the agenda decision with some edits to the text.

Special Purpose Acquisition Companies (SPAC): Accounting for Warrants at Acquisition: In March 2022, the Committee published a tentative agenda decision on how an entity accounts for warrants on acquiring a SPAC. Most respondents agreed (or did not disagree) with the technical analysis and conclusions but raised concerns about the potential unintended consequences. The Committee decided to finalise the agenda decision with some edits to the text.

IFRS 9 Financial Instruments and IFRS 16 Leases— Lessor Forgiveness of Lease Payments:  In March 2022, the Committee published a tentative agenda in response to the submission about a lessor’s application of IFRS 9 and IFRS 16 in accounting for a particular rent concession for which the only change to the lease contract is the lessor’s forgiveness of lease payments due from the lessee under that contract. 11 out of 23 respondents agreed with the analysis of the Committee but requested clarification on some aspects of the analysis while 11 respondents disagreed with the Committee’s analysis and conclusion. The Committee decided to finalise the agenda decision with some edits to the text.

Input on IASB project

Amendments to IAS 21—Lack of Exchangeability: In April 2021, the IASB published Exposure Draft ED/2021/4 Lack of Exchangeability, which proposed amendments to IAS 21. The purpose of the project is to assess the need to add requirements on how an entity determines whether a currency is exchangeable into another currency and the accounting requirements to apply when it is not. To assist the staff in developing recommendations for the IASB, the staff is asking Committee members for their views on one of the proposals in the ED—determining the spot exchange rate when exchangeability is lacking. The Committee members generally considered the paper is useful and helpful and gave suggestions/comments on some aspects of the recommendations to the ED.

Matters reported to the IASB: The staff have reported several of the Committee’s matters to the IASB but have not identified any matters to recommend for further discussion by the Committee. There were various matters that the IASB is considering as part of its work plan, may consider as part of its future work plan or considered and decided (or tentatively decided) not to add to the work plan.

Work in progress: There are no new matters that have not been presented to the Committee.

More In­for­ma­tion

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

General Sustainability-related Disclosures—Summary of comments

The ISSB received over 700 comment letters and/or surveys. Almost all respondents supported the ISSB’s overall aim to develop a comprehensive global baseline of sustainability-related financial disclosures for the capital markets. However, many respondents asked for greater clarity, support, guidance and examples to enable effective application of Exposure Draft (ED) IFRS S1. Many respondents also suggested that the ISSB should give more consideration to the range of capabilities and preparedness of entities around the world, especially for smaller entities and entities in emerging markets, to apply IFRS S1. Many respondents emphasised the importance of close collaboration with the IASB and the importance of improving understandability, connectivity and consistency by using shared definitions and concepts across IFRS Sustainability Disclosures Standards and IFRS Accounting Standards. In addition, many respondents observed key differences in concepts, terminologies and definitions remain between the ISSB’s proposals and jurisdictional initiatives and they emphasised the importance for the ISSB to work together with jurisdictions, including Europe and the United States, in developing a global baseline of sustainability-related financial disclosures.

Climate-related Disclosures—Summary of comments

The ISSB received comment letters and survey responses from nearly 700 respondents. The proposals in ED IFRS S2 were generally well-received, in particular by users of general purpose financial reporting, who expressed strong agreement with the proposed objective and the specific proposals.  While there was broad support for IFRS S2, many respondents also asked for greater support, guidance and examples to enable effective application of the proposals.

General Sustainability-related Disclosures and Climate-related Disclosures—Plan for redeliberations

Noting that there has been widespread support for the proposed requirements in the EDs, the staff suggest focusing on a limited number of topics for redeliberations, which are for joint topics relevant to both EDs: Scalability; and Current and anticipated effects of sustainability-related and climate-related risks and opportunities. For IFRS S1: enterprise value; breadth of reporting required; 'significant’ sustainability-related risk or opportunity; identifying significant sustainability-related risks and opportunities and disclosures; application of the materiality assessment; connected information; and frequency of reporting. For IFRS S2: strategy and decision-making, including transition planning; climate resilience; greenhouse gas emissions; and industry-based requirements, including financed and facilitated emissions.

General Sustainability-related Disclosures and Climate-related Disclosures—Scalability

Most respondents to the consultation suggested that the ISSB should give more consideration to the range of capabilities and preparedness of entities around the world to apply the proposals in the EDs. At this meeting, the ISSB members will be asked (i) whether they want to explore mechanisms to enable the requirements to be scalable, (ii) for feedback on the proposed mechanisms for addressing scalability and (iii) for feedback on the factors that should be used when evaluating which mechanism could be used for addressing particular scalability challenges.

Climate-related Disclosures—Financed and Facilitated Emissions

ED IFRS S2 proposed the addition of “Transition Risks Exposure” as a disclosure topic in the industry-based disclosure requirements for four industries–commercial banks, investment banking and brokerage, asset management and custody activities and insurance. The staff thinks the ISSB will need to consider in its future redeliberations the scope of the proposals, data considerations, industry breakdown, complexity and requests for increased flexibility.

IASB Update—Developing the IASB’s future work programme

In the presentation, the staff outline a breakdown of the IASB’s activities, its projects, key messages from the IASB’s agenda consultation and financial reporting issues added to the IASB’s work plan. The staff also provide a closer look at the IASB projects on Intangible Assets, Climate-related Risks in the Financial Statements project and Management Commentary.

Our pre-meet­ing summaries is available on our September meeting notes page and will be sup­ple­mented with our popular meeting notes after the meeting.

The following topics are on the agenda:

Equity Method

The staff recommend that when measuring the carrying amount to be derecognised in a partial disposal would identify the cost of the specific portion of the investment being disposed of or, if it cannot be identified, apply the last-in, first-out method. They also recommend relief to allow the weighted average method to be used as a practical expedient for equity method investments held prior to the transition date. The staff recommend that when an equity accounted investee issues equity instruments, and the investor continues to apply the equity method, if the ownership interest increases it would be treated as a purchase of an additional interest whereas a decrease would be a partial disposal. The IASB will also discuss application questions related to transactions between an investor and its associate or joint venture and acknowledged conflicts between the requirements in IFRS 10 and those in IAS 28.

Goodwill and Impairment

The staff recommend several changes to the IASB’s preliminary views in relation to disclosures about the objectives and rationale for the business combinations an entity has made, including an exemption from some of the disclosure requirements when disclosure would be seriously prejudicial to the entity’s objectives for the business combination. The staff also suggest that, if some disclosure requirements are required only for a sub-set of business combinations, the focus should be on strategically important business combinations—i.e. those for which failing to meet the objectives would seriously put at risk the entity achieving its overall business strategy.

Post-implementation Review (PIR) of IFRS 9—Classification and Measurement

At this meeting, the IASB will discuss questions relating to matters raised by respondents to the RFI that are not covered by other staff papers. The staff recommend that the IASB not consider further issues related to: derecognition and whether ‘substantially all of the risks and rewards’ of a financial asset have been transferred; assessing whether the entity has a practice of settling similar contracts net in cash when considering using the ‘own use exemption’; the disposal of equity instruments classified as fair value through other comprehensive income; whether interest rates contractually linked to an index that adjusts the time value of money based on a market interest rate and/or inflation rate introduce ‘leverage’ in the context of recent significant rises in inflation rates; and whether rates including a leverage factor imposed by the government should follow IFRS 9 for regulated rates guidance and, if so, how to consider whether the rate provides exposure to risks or variability in the contractual cash flows that are inconsistent with a basic lending arrangement. The staff therefore recommend that questions about purchased or originated credit-impaired financial assets be considered as part of the upcoming PIR of the impairment requirements in IFRS 9.

Financial Instruments with Characteristics of Equity (FICE)

The staff recommend clarifying that: IAS 32:23 would apply to an obligation to redeem own equity instruments settled in a variable number of another type of own equity instruments. They recommend that on expiry of a written put option on own equity instruments: the financial liability would be reclassified to the same component of equity as that from which it was reclassified on initial recognition of the put option; and the cumulative amount in retained earnings related to the put option would be permitted to be reclassified to another component of equity but amounts previously recognised in profit or loss on remeasuring the financial liability would not be reversed. Furthermore, written put options or forward purchase contracts on own equity instruments are presented gross rather than net.

Primary Financial Statements

The staff recommend that the IASB not proceed with any specific requirements for unusual income and expenses. They also recommend that all entities would classify income and expenses from associates and joint ventures accounted for using the equity method in the investing category. They recommend withdrawing the proposal that an entity classify incremental expenses in the investing category. However, the staff recommend confirming the proposal that the specified subtotals listed (in paragraph 104 of the ED) are not management performance measures and adding ‘operating profit or loss and income and expenses from investments accounted for using the equity method’ to the list of specified subtotals. Lastly, they recommend withdrawing the proposed prohibition on a mixed presentation of operating expenses.

Work plan

The staff will provide an update on the IASB’s work plan since its last update in May 2022. The staff recommend that the IASB consider in the second half of 2023 when to begin the PIRs of the hedge accounting requirements of IFRS 9 and the requirements of IFRS 16.

PIR of IFRS 15 Revenue from Contracts with Customers

The staff anticipate that they will undertake outreach from October 2022 to Q1 2023. The RFI is expected to be published in H1 2023, with a 120-day comment period.

Contractual Cash Flow Characteristics

In 2022, the IASB added a project to clarify particular aspects of the IFRS 9 requirements for assessing a financial asset’s contractual cash flow characteristics (i.e. the ‘solely payments of principal and interest’ (SPPI) requirements). The staff recommend clarifying that for contractual cash flows to be SPPI, a basic lending arrangement does not give rise to variability in cash flows due to risks or factors that are unrelated to the borrower, even if such terms and conditions are common in the specific market in which the entity operates. They also recommend setting out the factors when a financial asset that includes contractual terms that change the timing and amount of the contractual cash flows can be consistent with a basic lending arrangement and therefore have SPPI cash flows. The staff further recommend clarifying that the reference to ‘instruments' in paragraph B4.1.23 of IFRS 9 includes such as lease receivables.

Extractive Activities

The IASB will not be asked to make any decisions during this session. The staff will present papers summarising their reviews of disclosure-related stakeholder feedback from research carried out between 2018 and 2021, relevant academic literature and relevant jurisdictional requirements and a sample of annual filings.

Maintenance and consistent application

At its June 2022 meeting, the IFRS Interpretations Committee voted to finalise the agenda decision Cash Received via Electronic Transfer as Settlement for a Financial Asset (IFRS 9). The staff recommend that, rather than finalising the agenda decision, the IASB explore amending IFRS 9. In relation to the forthcoming amendments to IAS 1 for non-current liabilities with covenants, the staff recommend that the IASB clarify requirements around the early application of the 2020 amendments and the 2022 amendments.

Rate-regulated Activities

The staff recommend that the IASB clarify that an entity would apply IFRIC 12 first and then, apply the requirements of the proposed Standard to any remaining rights and obligations to determine if the entity has regulatory assets or regulatory liabilities.

Our pre-meet­ing summaries is available on our September meeting notes page and will be sup­ple­mented with our popular meeting notes after the meeting.

For the convenience of stakeholders in different time zones, there were two sessions of the webinar. Both of them have been recorded and the recordings are now available on YouTube:

• Morning session
• Afternoon session

The Boards will discuss the following:

• Goodwill and impairment
• Disaggregation-related projects
• Digital assets
• Agenda consultation

The full agenda for the meeting can be found here. We will post any updates to the agenda, our comprehensive pre-meeting summaries, as well as observer notes from the meeting on this page as they become available.

The statement released on the IOSCO website notes:

In particular, IOSCO welcomes the Boards’ plans to work towards high-quality, global assurance and ethics (including independence) standards that are profession-agnostic and can support limited, and ultimately, reasonable assurance of sustainability-related information. This work will serve to support the consistency, comparability and reliability of sustainability-related information provided to the market, enhancing trust in the quality of that information.

IOSCO also welcomes the dialogue that the IAASB and the IESBA have opened with the International Sustainability Standards Board (ISSB). IOSCO encourages continued close engagement as the standard-setters advance their respective work programmes to foster compatibility between international financial reporting, sustainability reporting, and assurance standards.

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

The full agenda for the meeting is summarised below.

A summary of the programme for the conference is set out below:

Please click to access the detailed programme for the event on the IASB website.

The WSS meeting will be immediately followed by a meeting of the International Forum of Accounting Standard Setters (IFASS) on 27-28 September 2022.

During its first meeting on 15 September 2022, the main discussions will focus on the current ISSB activities and the role of the SCC. There are no papers for the meeting. The full agenda is available here and registration as an observer is possible here (both links to the IFRS Foundation website).