On 13 July 2009, the Congress of the Republic of Colombia enacted Law No. 1314 concerning accounting, financial reporting and assurance. This law is called the "Law of Convergence" and states an intention to converge Colombian GAAP with international standards beginning from the year 2014 (proposed start year).

The official proposal from Consejo Técnico de la Contaduría Pública (as the National Standard Setter for Colombia) would see the standards issued by the IASB (for accounting and financial reporting) and IFAC (for auditing) adopted as the Colombian norms. Whilst only a strategic direction document, the proposals are an important step towards Colombia adopting international standards in due course.

Click for the text of the official proposal (PDF 404k, in Spanish).

The concept release presents several alternatives for changing the auditor's reporting model, seeking specific comment on these or other alternatives that could provide investors with more transparency in the audit process and more insight into the company's financial statements or other information outside the financial statements. The alternatives include:

• An auditor's discussion and analysis ('AD&A') – a supplemental narrative report to the auditor's report providing the auditor with the ability to discuss views regarding significant matters, such as audit risks identified in the audit, audit procedures and results, independence, and a discussion of the auditor's views regarding the company's financial statements (e.g. management's judgements and estimates, accounting policies and practices, and difficult or contentious issues)
• Required and expanded use of emphasis paragraphs – require inclusion of an expanded emphasis paragraph in all audit reports that would highlight the most significant matters in the financial statements and to identify where these matters are disclosed in the financial statements. Emphasis paragraphs could be required in areas of critical importance to the financial statements, including significant management judgements and estimates, areas with significant measurement uncertainty and other areas that the auditor determines are important for a better understanding of the financial statement presentation
• Auditor assurance on other information outside the financial statements – require auditors to provide assurance on information outside the financial statements, such as management's discussion and analysis (MD&A) or other information (for example, non-GAAP information or earnings releases)
• Clarification of language in the standard auditor's report – clarifying language about what an audit represents and the related auditor responsibilities, in areas such as reasonable assurance, auditor's responsibility for matters such as fraud, financial statement disclosures and information outside of the financial statements, management's responsibility for the preparation of the financial statements, and auditor independence.

The concept release notes the above alternatives are not seen as mutually exclusive, rather a revised auditor's report could include one or a combination of the alternatives, elements within the alternatives, or alternatives not currently presented.

Comments on the concept release close on 30 September 2011. Click for PCAOB press release (link to the PCAOB website).

The IASB stated in the Basis for Conclusions of IFRS 9 that it intended for the mandatory transition to all phases of the IAS 39 replacement project to occur concurrently, and that it may delay the effective date of the IAS 39 replacement project to better align with the effective date of the proposed insurance contracts guidance. Requests to review the mandatory effective date have also been received through the Request for Views and other outreach activities.

The Staff Paper notes the impairment and hedging phases of the project to replace IAS 39 are not yet complete, nor is the insurance project, and the staff recommends that on the basis of current circumstances the IASB should move the mandatory effective date of IFRS 9 to annual periods beginning on or after 1 January 2015. IFRS 9 is currently required to be applied for annual reporting periods beginning on or after 1 January 2013.

The full agenda for the July IASB meeting has not yet been formally announced. Click for access to the Staff Paper (link to the IASB's website).

• Monday, 27 June 2011 — Improvements to the accounting for post-employment benefits Webcasts will be held at 9.30am and 3.30pm, London time. Registration is available through the IASB's website.

Click for:

• Our June 16 article regarding the amendments to IAS 19 Employee Benefits

The IASB uses the annual improvements project to make necessary, but non-urgent, amendments to IFRSs that will not be included as part of another major project.

ED/2011/2 Improvements to IFRSs proposes the following amendments:

The ED proposes that all of the amendments will be effective for annual periods beginning on or after 1 January 2013, although entities shall be permitted to adopt them earlier. Click for IASB Press Release (link to IASB website).

You can access the ED via the the 'Comment on a proposal' page on the IASB's website. The IASB requests comments on the ED by 21 October 2011.

Japan has not yet made a decision on whether or not to mandatory adopt IFRSs, although voluntary adoption already started in 2010. The Business Accounting Council of Japan, with expanded members, will commence deliberation on the adoption question in later in June 2011.

The key changes announced by the Minister include:

• Mandatory application of IFRS will not take place from the business year ending March 2015, at the very least, and a sufficient time period of five to seven years will be permitted for preparation if and after mandatory application of IFRSs is decided
• The currently legislated expiry date of the ability to use US GAAP for disclosure purposes, namely up to the business year ending on or before 31 March 2016, will be removed so that the firms will be able to continue their use of US GAAP beyond that date.

As background to this change, the paper released by the FSA referred to various changes in the environment both in and out of Japan that have taken place since the issuance of the Interim Report in June 2009, including the release of the SEC work plan (February 2010), the announcement of a delay in the convergence programme by the IASB and FASB (April 2011), the US SEC staff report on the so-called 'condorsement' approach to the adoption of IFRS in the United States (May 2011), and domestic Japanese events such as the Great East Japan Earthquake and tsunami.

Click for more information (link to the Japanese Financial Services Agency, also available in Japanese).