The following topics are on the agenda:

Maintenance and consistent application

The IASB will make the final decisions on its project on Supplier Finance Arrangements. The staff recommend that entities be required to apply the amendments for annual reporting periods beginning on or after 1 January 2025, with earlier application permitted. The staff also recommend that the IASB require entities to apply the amendments retrospectively in accordance with IAS 8. 

Equity Method

IFRS 10 requires that when a parent loses control of a subsidiary it recognises a gain or loss. However, if the subsidiary is sold to an associate or joint venture of the parent, IAS 28 requires that the gain be limited to the  extent of the unrelated investors’ interests. This is perceived as a conflict. The IASB will discuss four ways of addressing the issue. The staff are seeking feedback and the IASB will not be asked to make any decisions at this meeting.

Business Combinations—Disclosures, Goodwill and Impairment

In September 2022, the IASB tentatively decided to exempt entities from some disclosure requirements but did not establish the conditions for that exemption. The staff are recommending that the exemption be based on whether disclosing the information could be expected to prejudice seriously any of the entity’s objectives for a business combination. Application guidance would set out the factors that would need to be considered when assessing if the exemption applies and entities would need to disclose the reason for applying the exemption. The staff also recommend that, subject to the proposed exemption, an entity be required to disclose quantitative information about total expected synergies disaggregated by nature (e.g. total revenue, total cost synergies), when the synergistic benefits are expected to start, and how long they are expected to last. In addition, the staff will ask the IASB to clarify a vote taken in the September 2022 meeting. The staff ask whether the vote means that an entity should be required to disclose a qualitative statement as to whether actual performance in subsequent periods met the target, to which the proposed exemption would apply, or whether it means that an entity is not required to disclose such a statement.

Primary Financial Statements

The staff recommend:

• Disaggregation: not requiring disaggregation of material information in relation to information about the nature of operating expenses that are included in a function line item in the statement of profit or loss; clarify the requirements for how disaggregated amounts are labelled (described); add a requirement that any line items presented in the statement(s) of financial performance and the statement of financial position must be recognised and measured in accordance with IFRS Accounting Standards but not prohibit the disaggregation of income and expenses in the notes to the financial statements into components not recognised and measured in accordance with IFRS Accounting Standards; and extend the proposals in the ED for the label ‘other’ to be used only if no more informative label can be found
• Comprehensive income: withdraw the proposal to relabel the two categories of other comprehensive income as remeasurements permanently reported outside profit or loss and income and expenses to be included in profit or loss in the future
• Statement of cash flows: confirm that entities other than entities with specified main business activities classify interest received as cash flows arising from investing; and confirm that entities with specified main business activities classify dividends received (other than dividends received investments accounted for using the equity method), interest paid and interest received in a single category of the statement of cash flows (either as cash flows from operating, investing or financing activities)

IFRS Accounting Taxonomy

In November 2022, the IASB published the Proposed IFRS Taxonomy Update—Lease Liability in a Sale and Leaseback and Non-current Liabilities with Covenants. The purpose of this meeting is to summarise the feedback received on the PTU and set out the next steps in the publication of the Update.

Disclosure Initiative—Subsidiaries without Public Accountability: Disclosures

The staff recommend that the IASB proceed with the proposal to include reduced disclosure requirements for IFRS 1. The staff also recommend that when an eligible subsidiary that elects, revokes an election or is no longer eligible to apply the Standard, it does not apply the requirements in IAS 8 on changes in accounting policies or be required to present a third statement of financial position. Finally, the staff recommend that the IASB confirm its proposal to consider amendments to the Standard when it publishes an exposure draft of a new or amended IFRS Accounting Standard.

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

The 19-minute webcast:

• provides background on the IASB’s alignment approach applied during this second comprehensive review;
• explains how this approach was applied to develop the proposals for financial instruments; and
• summarises the proposals for financial instruments.

The webcast can be accessed through the press release on the website of the IFRS Foundation.

New members will start on 1 January 2024 for a term of three years, renewable once for a further three years. For more information, please see the press release on the IASB website.

The proposed amendments would affect IPSAS 43 Leases (accounting for concessionary leases) and IPSAS 23 Revenue from Non-Exchange Transactions (new guidance on right-of-use assets in-kind).

Comments on the ED are requested by 17 May 2023. Please click for additional information and access to the ED in the press release on the IPSASB website.

The ITCG discussed the following topics:

• Digital representation of specific proposals related to the primary financial statements project:
  • subtotals/categories in the statement of profit or loss
  • disclosure of operating expenses by nature in the notes
• Summary of feedback on the staff draft of the IFRS Sustainability Disclosures Taxonomy

The meeting summary is available on the IFRS Foundation website.

The purpose of the meeting is to encourage ASAF members to share their views on the proposals by submitting a comment letter.

Please click for the agenda and agenda paper for the meeting on the IFRS Foundations website.

The webinars are:

• Part 1 (24 January, 14:00 GMT): Better information for better decisions — Introduction to investor-focused sustainability disclosure
• Part 2 (31 January, 16:00 GMT): Any size or stage — Getting started on climate disclosure
• Part 3 (7 February, 04:00 GMT): Connectivity and controls — The path to investor-grade disclosure

Please click for more information and registration on the IFRS Foundation website.

The following topics are on the agenda:

Metrics and Targets

The staff recommend minor drafting changes to clarify that the objective of disclosures on metrics and targets in the proposals is to enable users to understand performance on sustainability-related risks and opportunities, including (but not limited to) how an entity measures, monitors and manages such risks and opportunities.

Disclosure of judgements, assumptions and estimates

The staff recommend that the ISSB require, in addition to requiring disclosure of the sources of estimation uncertainty, the judgements that the entity has made in the process of preparing and disclosing its sustainability-related financial information. They also recommend requiring disclosure of the sources that have been applied in preparing the entity’s sustainability-related financial disclosures, including the industry or industries specified in IFRS Sustainability Disclosure Standards, SASB Standards or other industry-based sources of guidance.

The staff recommend clarifying that the words ‘to the extent possible’ mean ‘to the extent possible taking into consideration the requirements of IFRS Accounting Standards (or other relevant GAAP)’ and to require an entity to explain significant differences in the financial data and assumptions that the entity has used in preparing its sustainability-related financial disclosures, in comparison to those that the entity has used in preparing its financial statements.

Commercially sensitive information about opportunities

The staff recommend introducing an exemption in [draft] S1 that would permit entities, in limited circumstances, to exclude information about a sustainability-related opportunity when the information is commercially sensitive. It would specify that this would not be applicable to information which is already publicly available, nor would it able to be used to justify broad non-disclosure, using commercial sensitivity as a justification, or to avoid disclosing information about risks.

Reasonable and supportable information that is available at the reporting date without undue cost or effort

The staff recommend that the ISSB make minor drafting changes to clarify that when sustainability-related risks and opportunities have affected or are expected to affect the information in an entity’s financial statements, the entity is required to explain the connections between those current and anticipated financial effects and the sustainability-related risks and opportunities. They also recommend clarifying the relationship between resilience assessment requirements and the requirements to disclose current and anticipated financial effects by emphasising those requirements can be applied independently, but the resilience assessment can inform the disclosures of current and anticipated financial effects. Furthermore, clarifying that there is no requirement for an entity to perform a resilience assessment to determine current and anticipated financial effects of sustainability-related risks and opportunities.

Using scenario analysis to assess climate resilience

The staff recommend that the ISSB require an entity to use an approach to climate-related scenario analysis that enables the entity to consider all reasonable and supportable information that is available without undue cost or effort, at the reporting date, including information about past events, current conditions and forecasts of future economic conditions, taking into consideration the degree of the entity’s exposure to climate-related risks and opportunities and the skills, capabilities and resources available to the entity to conduct climate-related scenario analysis.

Greenhouse gas emissions—reporting period relief

The staff recommend that the ISSB provide relief that allows an entity to measure its GHG emissions using information for reporting periods that are different from the entity’s reporting period when that information arises from entities in its value chain with reporting periods that are different from that of the entity, on condition that the entity uses the most recent data available without undue cost or effort to measure and disclose its GHG emissions, the length of the reporting periods is the same and the entity discloses the effects of significant events and changes in circumstances (relevant to its GHG emissions information) that occur between the reporting dates of the entities in its value chain and the date of the entity’s general purpose financial reporting.

Climate-related targets—Latest international agreement on climate change

The staff recommend that the ISSB amend the proposal in paragraph 23(e) of [draft] S2 to require an entity to disclose how the latest international agreement on climate change has informed any climate-related targets it has set.

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

The Board will discuss the following:

• Business Combinations — Disclosures, Goodwill and Impairment
• Equity Method
• Disclosure Initiative — Subsidiaries without public accountability: Disclosures
• Primary Financial Statements
• Taxonomy Update
• Maintenance and Consistent Application

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.

One of the topics discussed was a shortened comment period for the proposed amendments to IAS 12 published today. The DPOC approved the shortened comment period in view of the urgency of the matter.

The other topic discussed was the due process review of the post-implementation review of the classification and measurement requirements of IFRS 9.

Please click to access the report of the meeting on the IFRS Foundation website.