News

Deloitte Comment Letter Image

Deloitte comment letter on IFRIC D7

01 Sep 2004

We have submitted our letter of comment on IFRIC Draft Amendment D7 to the Scope of Interpretation SIC 12 Consolidation—Special Purpose Entities.

Click to (PDF 53k). Deloitte's overall view:

We support the removal of 'equity compensation plans' from the scope exemption in SIC 12 and encourage the IFRIC to continue its project on providing guidance to determine whether these plans should or should not be consolidated. However, we question whether the additional change – unrelated to equity compensation plans – that eliminates defined contribution plans accounted for under IAS 19 from the exemption is appropriate at this time.

PCAOB (US Public Company Accounting Oversight Board) (dark gray) Image

PCAOB standard on audit documentation is approved

01 Sep 2004

The US Securities and Exchange Commission has approved the Public Company Accounting Oversight Board's Auditing Standard No.

3 Audit Documentation effective for audits of financial statements of companies with financial years ending on or after 15 November 2004. AS 3 establishes general requirements for documentation that an auditor should prepare and retain in connection with engagements conducted pursuant to PCAOB standards. Such engagements include an audit of financial statements, an audit of internal control over financial reporting, and a review of interim financial information. In general, the retention period is seven years. AS 3 applies to both US-based and foreign auditors of SEC registrants. AS 3 notes that section 106(b) of the Sarbanes-Oxley Act of 2002 imposes certain requirements concerning production of the work papers of a foreign public accounting firm on whose opinion or services the auditor relies. Compliance with AS 3 does not substitute for compliance with Section 106(b) or any other applicable law. You can Download Details from PCAOB's Website (PDF 174k).
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Lists of German companies currently using IFRSs and US GAAP

31 Aug 2004

The German Accounting Standards Committee has updated its lists of large German companies that are currently applying IFRSs, as well as those now using US GAAP and German GAAP.

These lists sorted by the 30 DAX, 50 MDAX, 50 SDAX, and 30 TecDAX companies. They are part of a series of frequently asked questions (FAQ) about German financial reporting, in English. Here is the Link to the FAQ File on the website of the GASC.
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Graded vesting of share options – FASB to differ from IFRS 2

31 Aug 2004

A decision of the US Financial Accounting Standards Board would create a significant difference between US GAAP and IFRSs on how to recognise the expense for share options with graded vesting.

Graded vesting means that portions of a single option grant will vest on two or more dates. The IFRS 2 requirement is explained in IFRS 2.IG11:

For example, suppose an employee is granted 100 share options, which will vest in instalments of 25 share options at the end of each year over the next four years. To apply the requirements of the IFRS, the entity should treat each instalment as a separate share option grant, because each instalment has a different vesting period, and hence the fair value of each instalment will differ (because the length of the vesting period affects, for example, the likely timing of cash flows arising from the exercise of the options).

That had been FASB's proposal as well. However, after considering the comments on its current exposure draft, FASB has now decided to give entities the choice of recognising the expense on a straight-line basis. Treating each instalment as a separate grant has the effect of recognising more expense up front.
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Draft guidance for auditors on first-time IFRS adoption

30 Aug 2004

The Auditing Practices Board of the United Kingdom has issued a 37-page draft bulletin on Guidance for Auditors on First-time Application of IFRSs in the United Kingdom.

The bulletin would provide auditors with interim guidance on issues that may arise when entities move from UK GAAP to IFRSs. Comments on the draft are due by 31 October 2004. Among the audit risks noted are limited experience with IFRSs, problems caused by systems changes, shortage of resources, identification of all of the differences between the accounting frameworks, valuation issues in such areas as share options and non-traded financial instruments, and earnings management. Regarding the latter, the bulletin notes:

There may be opportunities for aggressive earnings management by companies. For example, management may wish to set an advantageous starting figure for earnings under IFRSs in the year of transition, conscious of the implications for future years. This could involve setting the figure as low as possible in the year of such a major change, while attention is focussed on the changeover itself, so giving leeway for flattering increases in earnings in future years.

Click for:
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Agenda for IASB September meeting is posted

26 Aug 2004

The International Accounting Standards Board will meet on Tuesday through Friday, 21-24 September 2004, in London.

The meeting will be the first to adopt the IASB's new meeting framework, which includes both educational (non-decision-making) and deliberative sessions. In the agenda shown below, all sessions are deliberative unless marked educational. The Board will also meet on Monday morning 27 September 2004 and then again on Wednesday morning 29 September 2004 with the chairs of its eight liaison standard-setting bodies. Further, the Board will host a meeting of representatives of over 30 world accounting standard setters on the afternoon of Monday 27 September 2004 and continuing all day Tuesday 28 September 2004.

AGENDA OF THE IASB MEETING 21-24 SEPTEMBER 2004

Tuesday 21 September

Wednesday 22 September

  • Morning: Educational session on Insurance
  • Afternoon: Accounting Concepts – initial consideration of this topic
  • Afternoon: Business Combinations Phase II – Issues related to the proposed fair value hierarchy and combinations involving mutual entities

Thursday 23 September

Friday 24 September

MEETINGS WITH STANDARD SETTERS 27-29 SEPTEMBER 2004

Monday 27 September 2004

  • Morning: Meeting with national standard-setters
  • Afternoon: Meeting with world standard-setters
Tuesday 28 September 2004
  • All day: Meeting with world standard-setters
Wednesday 29 September 2004
  • Morning: Meeting with national standard-setters
ifrsgermangaap.gif Image

German GAAP–IFRS comparison is now available

26 Aug 2004

The second edition of Deloitte's 170-page comparison of German GAAP and IFRSs – Rechnungslegung nach IFRS – is now available.

The book contains a general introduction into IFRSs, the IASB, and the IAS regulation; a summary of the key aspects of IFRS 1; and a line item by line item comparison. It concludes with an executive summary. For more information please visit the Publisher's Website.
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Deloitte guide to IFRS 1 First-time Adoption of IFRSs

26 Aug 2004

We have posted a new Deloitte publication First-time Adoption – A Guide to IFRS 1.

This 104-page bound booklet deals with first-time adoption issues related to the stable platform IFRSs, with focus on 2005 adopters. The booklet includes:
  • A summary of IFRS 1.
  • Specific issues related to first-time adoption.
  • Questions and responses.
  • A disclosure checklist.
  • A large number of illustrative examples.
Click to (PDF 2,506k).
IFRIC (International Financial Reporting Interpretations Committee) (blue) Image

Interpretations Committee will meet next week in London

25 Aug 2004

The International Financial Reporting Interpretations Committee (IFRIC) will meet on Thursday and Friday, 2 and 3 September 2004, at the offices of the IASB in London.

The agenda:

AGENDA OF THE IFRIC MEETING 2-3 SEPTEMBER 2004

EFRAG (European Financial Reporting Advisory Group) (dk green) Image

EFRAG announces its 2005 meeting schedule

24 Aug 2004

The EFRAG Technical Expert Group (TEG) is coordinating the dates of its 2005 meetings with those of the IASB, generally holding meetings (which are open to public observation) during the week preceding the IASB Board meeting, as follows (locations may change from Brussels).

EFRAG's 2004 meeting dates are also shown:

 

2004 Month

IASB Board

SAC

WSS

Location

EFRAG TEG

Location

September

22 to 24

27

London

Wed-Fri 1 to 3

Brussels

October

18 to 22

Norwalk

Wed-Fri 6 to 8

Brussels

November

15 to 17

18/19

London

Wed-Fri 3 to 5

Brussels

December

15 to 17

London

Tue-Thu 7 to 9

Brussels

2005 Month

IASB Board

SAC

WSS

Location

EFRAG TEG

Location

January

17 to 21

London

Wed-Fri 12 to 14

Brussels

February

14 to 18

10/11

London

Mon-Wed 7 to 9

Brussels

March

14 to 18

London

Wed-Fri 9 to 11

Brussels

April

18 to 22

London

Wed-Fri 13 to 15

Brussels

May

16 to 20

London

Wed-Fri 11 to 13

Brussels

June

20 to 24

27/28

London

Wed-Fri 15 to 17

Brussels

July

18 to 22

London

Mon-Wed 11 to 13

Brussels

August

September

19 to 23

26/27

London

Wed-Fri 7 to 9

Brussels

October

17 to 21

Norwalk

Wed-Fri 5 to 7

Brussels

November

14 to 18

10/11

London

Tue-Thu 8 to 10

Brussels

December

12 to 16

London

Wed-Fri 7 to 9

Brussels

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