The guidance warns against complacency that there are not many differences between UK GAAP and IFRSs:

It is easy to make a high-level comparison of UK GAAP and IFRS and conclude that there are few major differences; however there are many important detailed differences, many of which will be discovered only by a thorough analysis of a company's transactions and exposures. Matters that need to be considered include: changes brought by the move to IFRS will mean a major change in the actual format of the accounts; differences in definitions may mean that items previously classified in one way will need to be classified differently; some items that are not recognised under UK GAAP are recognised as assets or liabilities under IFRS, whilst others may cease to be recognised; some items may have to be measured differently in the accounts of an individual subsidiary and in the consolidated accounts; more extensive disclosure requirements will result in greater data capture needs; and some changes in accounting policies may require accounting systems to give different information.

Click for (PDF 36k).

The IASB has Posted on its Website the 81 comment letters it has received on the Exposure Draft of Proposed Amendments to IAS 39 Financial Instruments: Recognition and Measurement: The Fair Value Option.

Also, EFRAG has invited comments on its draft comment letters on two additional documents:

• ED of Amendments to IAS 39: The Fair Value Option (PDF 1,244k)
• ED of Amendments to IAS 19: Actuarial Gains and Losses, Group Plans and Disclosures (PDF 55k)
• ED of Amendments to IFRS 3: Combinations by Contract Alone or Involving Mutual Entities (PDF 48k)
• IFRIC D6 Multi-employer Plans (PDF 58k)

Draft comment letters: (download from EFRAG's website www.efrag.org)

• ED of Amendments to IAS 39: Financial Guarantee Contracts and Credit Insurance (comments due 24 September 2004)
• IFRIC D9 Employee Benefit Plans with a Promised Return on Contributions or Notional Contributions (comments due 27 August 2004)

 

The Commission will seek public comment on alternative methods and the costs and benefits associated with tagged data. In addition, the Commission will consider a staff proposal to accept voluntary supplemental filings of financial data using eXtensible Business Reporting Language (XBRL). This voluntary program would enable the Commission staff to further investigate the types of data tagging currently available in the marketplace. The Commission may propose a rule this fall that would, if adopted, establish the voluntary program beginning with the 2004 calendar year-end reporting season.

• Click for SEC Press Release.
• Information about XBRL (a system for tagging data) can be found on the XBRL International Website. IASB commercial director Kurt Ramin chairs the XBRL International Steering Committee.
• An exposure draft dated 15 June 2004 International Financial Reporting Standards (IFRS) General Purpose Financial Reporting for Profit-Oriented Entities (GP) can be found Here.
• Other XBRL financial reporting taxonomies can be found Here.
• The 10th XBRL International Conference, Financial Reporting Goes Global: XBRL and IFRS Working Together, will be held 15-17 November 2004 in Brussels. Click for More Information.
• The European Commission has granted €1,000,000 to accelerate the development and adoption of XBRL in Europe. Press Release (PDF 110k).

IAS 32 would then deal only with financial instruments presentation matters. ED 7 Financial Instruments: Disclosures would require disclosures in the following areas, among others:

• Disclosure of the significance of financial instruments for an entity's financial position and performance (this would incorporate many of the requirements previously in IAS 32)
• Qualitative and quantitative disclosures about exposure to risks arising from financial instruments. The qualitative disclosures describe management's objectives, policies, and processes for managing those risks. The quantitative disclosures provide information about the extent to which the entity is exposed to risk, based on information provided internally to the entity's key management personnel. Together, these disclosures provide an overview of the entity's use of financial instruments and the exposures to risks they create
• Disclosures about credit risk, including credit enhancements and the fair value of and other information about collateral received
• Disclosures about interest rate risk, which would include both cash flow interest rate risk and fair value interest rate risk. Sensitivity analyses for interest rate and foreign exchange rate risks would be required
• Disclosures about market risk, including information about asset quality and the liquidity of the markets in which a financial asset might be disposed.
• Disclosures about other risks, sometimes called residual value risks, that underlie financial instruments and that are not captured by the other disclosures
• Details about an entity's own equity; qualitative information about the entity's objectives, policies, and processes for managing capital; whether during the period it complied with any capital targets set by management and any externally imposed capital requirements; and if it has not complied, the consequences of such non-compliance.

ED 7 would delete the current IAS 30 disclosures about contingencies, commitments, and general banking risks.

Click for the IASB Press Release (PDF 31k). ED 7 will be available for public download from www.iasb.org starting 2 August 2004.

Comment deadline is 22 October 2004. The Board expects to issue a final standard in early 2005. It would be mandatory for financial periods beginning on or after 1 January 2007. Early adoption will be encouraged, and therefore that standard could be applied by 2005 first time adopters.

 

We have combined our notes for all three days in a Separate Page.

This 43-page book provides step-by-step guidance on implementing a strong system of internal control to meet the requirements of Sarbanes-Oxley section 404. SEC-registered companies that have not yet begun to develop their system of internal control – such as non-accelerated filers and foreign private issuers -- may benefit from a cover-to-cover reading. Accelerated filers, who are likely to be further along with their internal control project because of the Act's earlier effective date for them, may opt to pick and choose cafeteria-style from the material either to measure their progress or to ensure quality control. An appendix contains supplementary information, sample forms, glossary, and reference material. Click to (PDF 1.02mb).

Two other members of the IFRIC will be leaving a year before their terms expire — Clement Kwok, Hong Kong and Shanghai Hotels Limited, and Wayne Lonergan, Lonergan Edwards & Associates Limited. A search is underway for their replacements. Click for Press Release (PDF 17k) and Search Announcement (PDF 9k).

We have combined our notes for all three days in a Separate Page.

Here is an excerpt from the letter:

We believe the Proposed Amendment diverges from a principle-based approach to a set of arbitrary rules. In addition, the basis for the proposed rules is unclear, which creates the potential for differing interpretations that are not consistent with the Board's intent. We also believe the introduction of a new 'verifiability' measurement standard as a condition for using the fair value option will raise numerous implementation issues. We do not believe the Proposed Amendment is an ideal or workable solution. The worldwide system of reporting should be based on open and transparent accounting, free from national distortions and pressures. We believe political involvement in the standard setting process hinders the movement towards a single set of high quality, globally accepted accounting standards. We note that there has been much debate surrounding the use of fair value as a measurement basis for financial assets (and liabilities). We do not believe the proposals represent a high quality solution and, accordingly, we question whether the Proposed Amendment would be accepted by other standard-setters in the quest for convergence around high quality solutions.