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Proposed wording of IFRS audit reports in the UK

25 May 2005

The United Kingdom Auditing Practices Board (APB) has issued for comment a draft bulletin titled Auditor's Reports on Financial Statements.

For all UK companies whose securities are publicly traded in the EU, the APB proposes that the auditor's report refer to conformity with IFRSs adopted for use in the European Union as the primary reporting framework:

In our opinion the group financial statements give a true and fair view, in accordance with those IFRSs adopted for use in the European Union....

The draft bulletin notes that many companies will be in a position of complying with both IFRSs as issued by the IASB and those IFRSs adopted for use in the European Union. If that is the case, and if the entity wants the auditor also to express an opinion about conformity with IFRSs, the draft bulletin proposes that the auditor separately state a second opinion with regards to full IFRSs, as follows:

As explained in Note X, the group in addition to complying with its legal obligation to comply with those IFRSs adopted for use in the European Union, has also complied with the IFRSs as issued by the International Accounting Standards Board. In our opinion the group financial statements give a true and fair view, in accordance with IFRSs....

The draft bulletin may be downloaded from the APB's Website. Comments are requested by 1 August 2005.
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Report from the 20 May 2005 ARC meeting

25 May 2005

At its meeting on 20 May 2005, the Accounting Regulatory Committee, which advises the European Commission on endorsement of individual IFRSs and IFRIC Interpretations for use in Europe, agreed unanimously to recommend endorsement of IFRS 6, IFRIC Interpretations 4 and 5, IFRIC's recent amendment to SIC 12, and the IASB's recent amendment to IAS 19, and related consequential amendments.

ARC members also expressed strong support for the Commission's intention to endorse the IASB's proposed amendments to the Fair Value Option in IAS 39, pending publication of the amendments by the IASB. The Commission intends to seek the ARC's approval of these amendments at the ARC's next meeting on 8 July 2005. With respect to IFRIC 3 Emission Rights, in light of EFRAG's recommendation that the Commission not endorse IFRIC 3 for use in Europe, the Commission has asked the IASB to defer the effective date of IFRIC 3. If the effective date is not deferred, the ARC will be asked to decide on IFRIC 3 at its 8 July 2005 meeting. Click here to download the (PDF 36k). Background papers for the 20 May 2005 ARC meeting may be found at The ARC Website.
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Deloitte Chairman will speak at IFRS conference in Dubai

25 May 2005

Piet Hoogendoorn, chairman of the Deloitte Touche Tohmatsu (DTT) Board of Directors, will speak at the World Accounting Summit being held in Dubai, United Arab Emirates, on 29 May to 1 June 2005. The conference is under the patronage of the United Nations Conference on Trade and Development (UNCTAD).

The event will bring together senior representatives from the global standards setters and major accounting associations as well as principal advisers to multinational companies and key users and preparers of financial statements. A major step in the worldwide convergence of accounting standards, IFRSs present new opportunities for those in professional services – as well as difficulties, particularly with respect to consistent application. As DTT Chairman, Piet will discuss the challenges now being encountered with the adoption of IFRSs and how Deloitte member firms work to address client needs and concerns. Several other partners from Deloitte member firms will also be participating in this conference, including Abbas Ali Mirza, Deloitte Dubai; Stig Enevoldsen, Deloitte Denmark and current chair of EFRAG, Europe; and Asad Ali Shah, Deloitte Pakistan.
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Near-final draft of IFRS 7 is available to subscribers

25 May 2005

The IASB has posted to the 'Subscribers' section of its website the near-final draft of IFRS 7 Financial Instruments: Disclosures.

A near-final draft is one awaiting formal Board approval and for which only relatively small editorial changes are expected. IFRS 7 will replace IAS 30 Disclosures in Financial Statements of Banks and Similar Financial Institutions and also will replace the disclosure portions of IAS 32 Financial Instruments: Disclosure and Presentation. The standard will apply to all entities and will require disclosure of:
  • the significance of financial instruments for an entity's financial position and performance; and
  • qualitative and quantitative information about exposure to risks arising from financial instruments, including minimum disclosures about credit risk, liquidity risk, and market risk.
IFRS 7 will be effective for financial years beginning on or after 1 January 2007, with earlier application encouraged. If an entity decides to apply IFRS 7 to financial years beginning before 1 January 2006 (for instance, for calendar year 2005), it need not present comparative (2004) information for the required risk disclosures.
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Reminder – comment deadlines next week

24 May 2005

Deadlines for submitting comments on the following draft interpretations are one week from today (Tuesday 31 May 2005): IFRIC D12 Service Concession Arrangements – Determining the Accounting Model IFRIC D13 Service Concession Arrangements – the Financial Asset Model IFRIC D14 Service Concession Arrangements – the Intangible Asset Model IFRIC D15 Reassessment of Embedded Derivatives .

Deadlines for submitting comments on the following draft interpretations are one week from today (Tuesday 31 May 2005):

  • IFRIC D12 Service Concession Arrangements – Determining the Accounting Model
  • IFRIC D13 Service Concession Arrangements – the Financial Asset Model
  • IFRIC D14 Service Concession Arrangements – the Intangible Asset Model
  • IFRIC D15 Reassessment of Embedded Derivatives
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Agenda for IFRIC 2-3 June 2005 meeting

23 May 2005

The International Financial Reporting Interpretations Committee (IFRIC) will meet at the IASB's offices in London on Thursday and Friday, 2-3 June 2005. The agenda for the meeting is presented below. 2-3 June 2005, London Thursday 2 June 2005 IAS 19 Employee Benefits – Effect of Minimum Funding Requirements on the Asset Ceiling Emission Rights - Consideration of a Proposed Amendment of Revised Draft IAS 38 — The IFRIC will consider a draft of an amendment to IAS 38. The objective of the amendment is to address the measurement mismatches that arise in accounting for an emission rights scheme in accordance with IFRIC 3. IAS 12 Income Taxes – Deferred Tax Relating to Finance Leases Impairment of an Equity Security – Draft Reason for Rejection of Issue IAS 19 Priorities Consideration of Recommendations of Agenda Committee as tabled at March/April Meeting of IFRIC from February Agenda Committee Meeting IFRIC D11 Changes in Contributions to Employee Stock Purchase Plans Friday 3 June 2005 IAS 32 Financial Instruments: Disclosure and Presentation – Cross Currency Convertible Bonds IFRIC D9 Employee Benefit Plans with a Promised Return on Contributions or Notional Contributions Tabling from March Agenda Committee of Wording for Issues Proposed for Rejection Activities of Other Interpretive Bodies .

The International Financial Reporting Interpretations Committee (IFRIC) will meet at the IASB's offices in London on Thursday and Friday, 2-3 June 2005. The agenda for the meeting is presented below.

2-3 June 2005, London

Thursday 2 June 2005

  • IAS 19 Employee Benefits – Effect of Minimum Funding Requirements on the Asset Ceiling
  • Emission Rights - Consideration of a Proposed Amendment of Revised Draft IAS 38 — The IFRIC will consider a draft of an amendment to IAS 38. The objective of the amendment is to address the measurement mismatches that arise in accounting for an emission rights scheme in accordance with IFRIC 3.
  • IAS 12 Income Taxes – Deferred Tax Relating to Finance Leases
  • Impairment of an Equity Security – Draft Reason for Rejection of Issue
  • IAS 19 Priorities
  • Consideration of Recommendations of Agenda Committee as tabled at March/April Meeting of IFRIC from February Agenda Committee Meeting
  • IFRIC D11 Changes in Contributions to Employee Stock Purchase Plans

Friday 3 June 2005

  • IAS 32 Financial Instruments: Disclosure and Presentation – Cross Currency Convertible Bonds
  • IFRIC D9 Employee Benefit Plans with a Promised Return on Contributions or Notional Contributions
  • Tabling from March Agenda Committee of Wording for Issues Proposed for Rejection
  • Activities of Other Interpretive Bodies
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Near-final draft of IFRS 7 expected soon

23 May 2005

The IASB plans to make available on its website in the next several days a 'near-final' draft of IFRS 7 Financial Instruments: Disclosures.

The Board is still considering the issue of 'Day 1 profit disclosures' and has invited comment on the proposed drafting of this section of IFRS 7. The proposed disclosures were set out in pages 19-21 of the Observer Notes for the May Board meeting. Those notes may be Downloaded from the IASB's website. Comments should be sent to apryde@iasb.org by 1 June 2005.
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13th UK webcast update – interim reporting

21 May 2005

The Deloitte London IFRS Centre of Excellence is running a monthly series of hour-long Internet-based IFRS technical updates, focusing on the most important international accounting standards and how they will affect UK companies.

The thirteenth session was run on Thursday 19 May 2005 and focused on the rules applying to the 2005 interim financial statements of listed UK groups and the requirements of IAS 34 Interim Financial Reporting. To access the recording Click Here. The recording of each session will be available on this website for a period of at least 3 to 4 weeks from the date of the presentation. Links to past sessions may be found on our United Kingdom Page. The recording is no longer available online.
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IFRS financial statements and checklist for 2005

21 May 2005

We have posted Deloitte's comprehensive for the year ended 31 December 2005 (PDF 851k).

These model financial statements were developed to illustrate the typical financial statement presentation and disclosures that are required of a company with subsidiaries and associates presenting its consolidated financial statements under IFRSs for 2005.
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Two draft interpretations on IFRS 2

20 May 2005

The International Financial Reporting Interpretations Committee (IFRIC) has published two draft Interpretations relating to IFRS 2 'Share-based Payment'.

The draft Interpretations relating to IFRS 2 Share-based Payment are:

  • D16 Scope of IFRS 2
  • D17 IFRS 2 – Group and Treasury Share Transactions.

D16 clarifies that transactions within the scope of IFRS 2 include those in which the entity cannot specifically identify some or all of the goods or services received.

D17 provides guidance on whether particular types of transactions should be accounted for as cash-settled or equity-settled share-based payment transactions under IFRS 2.

Click for Press Release (PDF 52k).

 

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