The Board is considering amending IFRS 9 Financial Instruments and IAS 39 Financial Instruments: Recognition and Measurement to provide relief from the effects of uncertainties caused by the reform of IBOR. The staff are recommending that relief be provided in relation to the highly probable requirement and prospective assessments, but not for designation of risk components that are not separately identifiable. An Exposure Draft is likely to be published in April with a short comment period, enabling any amendments to be finalised and published by December 2019, with an effective date of 1 January 2020.

The Board will continue to assess concerns and implementation challenges raised by stakeholders about the requirements in IFRS 17 Insurance Contracts. The staff are recommending that IFRS 17 and IFRS 9 be amended to allow an entity to apply either IFRS 17 or IFRS 9 to insurance contracts for which the only insurance in the contract is for the settlement of some, or all, of the obligation created by the contract (with consequential amendments to the disclosure requirements). The staff are recommending that the transition requirements in IFRS 17 be retained, except for a liability that relates to the settlement of claims incurred before an insurance contract was acquired. The staff are recommending a change to the modified retrospective approach that would require an entity to classify such liabilities as a liability for incurred claims (to the extent that it does not have reasonable and supportable information to apply a retrospective approach) and to permit an entity applying the fair value approach to choose to classify such liabilities as a liability for incurred claims.

For the Primary Financial Statements project, the staff are recommending that the Board modify some of its earlier decisions. Within the statement of cash flows, the starting point for the reconciliation of operating cash flows should be the operating profit subtotal, for all entities. Additionally, they are recommending that all entities classify cash flows from dividends paid as financing cash flows and cash flows from dividends received from equity-accounted associates and joint ventures as investing cash flows. However, the staff also set out special requirements, for both the statement of cash flows and the statement(s) of profit or loss and other comprehensive income, for entities that have as their main business activity providing financing to customers or investing in assets that generate a return individually and largely independently of other resources held by the entity. The staff also present additional proposals related to aggregation and disaggregation of information in the primary financial statements and in the notes, including a requirement to describe items in a way that faithfully represents the items they aggregate.

The Board will consider a project plan for a comprehensive review of the IFRS for SMEs Standard that proposes the publication of a Request for Information by about July 2019, an Exposure Draft sometime between January 2020 and February 2021 and amendments between July 2021 and May 2022. The IFRS for SMEs Standard does not reflect the current requirements in IFRS 3, 10, 11, 12, 13, 14, 15, 16 or 17.

The staff will also give an oral update on the Management Commentary project (the consultative group met in January).

More information

Our pre-meeting summaries are available on our February meeting note page and will be supplemented with our popular meeting notes after the meeting.

Participants at the meeting — which was chaired by IASB member Amaro Gomes — discussed the Discussion Paper Financial Instruments with Characteristics of Equity, the next steps in the goodwill and impairment project, accounting for micro-entities in Brazil, the forthcoming review of IFRS for SMEs standard, implementation of IFRS 9 Financial Instruments, the extractive activities project, and a project update.

The next meeting of the EEG will be held 25–27 March 2019 in Argentina.

Please click for access to the full report (seven pages) on the IASB website.

The topics covered during the meeting were the following (numbers in brackets are references to the corresponding paragraphs of the summary):

• Financial instruments with characteristics of equity (1–25): ASAF members provided comments on the Discussion Paper Financial Instruments with Characteristics of Equity based on the outreach in their jurisdictions.
• Business combinations under common control (BCUCC) (26–32): ASAF members discussed whether a current value measurement approach based on the acquisition method set out in IFRS 3 Business Combinations should be applied to all or some BCUCC that affect non-controlling shareholders in the receiving entity and if not, how the distinction should be made on when to use a current value measurement approach.
• Pension benefits that depend on asset returns (33–43): ASAF members discussed whether the measurement approach (described in Agenda Paper 7) would be helpful in solving the measurement inconsistency described in that paper when applying IAS 19 Employee Benefits to pension benefits that depend on asset returns.
• IFRS 17 Insurance Contracts (44–61): ASAF members provided advice on six topics in IFRS 17 Insurance Contracts that the Board is considering for possible amendments to the Standard.
• Management commentary (62–76):ASAF members were updated on the Board's tentative decision on the objective of management commentary as part of the update to IFRS Practice Statement 1 Management Commentary.
• Goodwill and impairment (77–87): ASAF members discussed (1) disclosure objective and requirements and (2) amortisation of goodwill, including whether members believe it is feasible to estimate the useful life of goodwill.
• Update and agenda planning (88–91): ASAF members discussed the proposed agenda for the April 2019 ASAF meeting and considered future discussions on (1) how the ANC has established an accounting framework for crypto-currencies and (2) EFRAG's forthcoming discussion paper Hybrid Pension Schemes.
• Better communication – primary financial statements (92–108):ASAF members discussed the Board's tentative decisions made to date in the primary financial statements project.

A full summary of the meeting is available on the IASB's website.

The 7-minute podcast can be accessed through the press release on the IASB website. Our Deloitte meeting notes of the session are available here.

The 8-minute podcast features discussions of the following topics in more detail:

• IFRS 17 Insurance Contracts
• Proposed amendments to IAS 12
• Meeting of the IFRS Foundation Trustees in Kuala Lumpur

The podcast can be accessed through the press release on the IASB website. More information on the topics discussed is available through our comprehensive notes taken by Deloitte observers at the January IASB meeting.

In his speech, Mr Liikanen noted that voices from across the Asia-Oceania region are well represented at all levels of the IFRS Foundation and the various advisory bodies. As an example of valuable contributions from the region, Mr Liikanen cited the MASB’s work on how to value specific biological assets that led to amendments to IAS 16 and IAS 41.

Turning to future challenges for the IFRS Foundation, Mr Liikanen made out three key priorities:

• The Foundation needs to consolidate and build upon the achievements of recent years. He warned against movements away from global achievements and in this context mentioned the recent European Commission's Fitness Check (which, however, showed that a large majority of respondents were against an EU set of standards).
• The Foundation also needs to ensure that IFRSs remain relevant in a changing world. In this context, Mr Liikanen noted that investors are not only interested in the pure financial statements anymore but also want to know about non-financial information.
• And finally the Foundation is faced with the question of remaining relevant in a digital world. Mr Liikanen notes that the Foundation will continue to explore how technological developments affect the way financial information is consumed and how technology-related innovations affect the standard-setting process.

Please click to access the full transcript of the speech on the IASB website. A recording of the speech is available through the press release on the MASB website.

Mr Kabureck began by discussing how the December 2014 amendments to IAS 1 marked the ‘first foray into addressing disclosure materiality’. He stated IFRS disclosure requirements used phrases, such as ‘At a minimum an entity shall disclose . . .’, which were interpreted in practice in a way that was not intended by the IASB and actions were taken to clarify that materiality concept always overrules these certain phrases.

Next, he discussed key messages in the September 2017 IFRS Practice Statement Making Materiality Judgements, which provides an outline for making materiality judgements and assessing their implications. He noted that the Practice Statement helps preparers define who the target audience for a company’s financial reporting is and what information is needed. Also, the Practice Statement makes it clear that ‘materiality is assessed in the context of the financial statement taken as a whole…’.

Further, Mr Kabureck commented on the revised definition of ‘material’ issued in October 2018. The amendments conformed the definition of material among various IFRS Standards. He mentioned that the revision to the definition from ‘could influence’ to ‘could reasonably be expected to influence’ provided a more accurate representation of the Board’s intention.

Lastly, he expressed the need to analyse how Standards are drafted and how to amend certain Standards with known issues.

For more information, see the article on the IASB’s website.

The agenda is summarised below:

Agenda papers for this meeting are available on the IASB website.

The following agenda papers around IFRS 17 will be discussed (links to IASB website):

• AP2A: Loans that transfer significant insurance risk
• AP2B: Transition — Optionality and comparative information
• AP2C: Transition — Risk mitigation option and amounts accumulated in other comprehensive income on transition
• AP2D: Transition — Modified retrospective approach

The discussion on IFRS 17 is presently scheduled for 7 February, 14:45-16:45 (UK time).

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.

Below is an analysis of all changes that were made to the work plan since our last analysis on 17 December 2018.

Standard-setting projects

• No changes.

Maintenance projects

• Accounting Policies and Accounting Estimates — The IASB will decide on the project direction in April 2019 (formerly Q2 2019).
• Amendments to IFRS 17 Insurance Contracts — An exposure draft is expected in Q2 2019 (formerly H1 2019).
• Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction — An Exposure Draft is expected in Q2 2019 (formerly H1 2019).
• Fees in the ‘10 per cent’ Test for Derecognition — An exposure draft is expected in Q2 2019 (formerly H1 2019).
• IBOR Reform and its Effects on Financial Reporting — Formerly listed as a research project, an exposure draft is expected in Q2 2019 (formerly H1 2019). — NB This update actually reflects a December 2018 decision of the Board.
• Lease Incentives — An exposure draft is expected in Q2 2019 (formerly H1 2019).
• Onerous Contracts — Cost of Fulfilling a Contract — Exposure draft feedback is expected in Q2 2019 (formerly H1 2019).
• Subsidiary as a First-time Adopter — An exposure draft is expected in Q2 2019 (formerly H1 2019).
• Taxation in Fair Value Measurements — An exposure draft is expected in Q2 2019 (formerly H1 2019). 
• Updating a Reference to the Conceptual Framework — An exposure draft is expected in Q2 2019 (formerly H1 2019). 

Research projects

• Business Combinations under Common Control — A discussion paper is expected in H1 2020 (formerly just listed as 2020).
• Goodwill and Impairment — The next milestone was changed to a discussion paper, instead of the previously-listed "discussion paper or exposure draft."
• Disclosure Initiative — Principles of Disclosure — A project summary is expected in March 2019 (formerly listed as Q1 2019).
• Financial Instruments with Characteristics of Equity — Discussion paper feedback is expected in March 2019 (formerly Q1 2019).
• Provisions — New project added to the work plan; the IASB plans to review research in the second half of 2019. — NB This update actually reflects a December 2018 decision of the Board.

Other projects

• IFRS Taxonomy Update — 2018 General Improvements — A date of February 2019 was added for the proposed update feedback.
• IFRS Taxonomy Update — Common Practice (IFRS 13) — The next milestone was changed from "analyse feedback" to "final update" with an expected date of March 2019. — NB This update seems somewhat premature since the feedback received will not by anlysed by the ITCG until its 31 January meeting.
• Revisions to the Preface to IFRS Standards — Project removed from the work plan. — NB This changed entry actually reflects an October 2018 decision of the Board.

The above is a faithful comparison of the IASB work plan at 17 December 2018 and at 25 January 2019. For access to the current IASB work plan at any time, please click here.