Previously, a company whose primary listing is on the JSE could elect to comply with either South African Statements of Generally Accepted Accounting Practices (SA GAAP) or IFRS. Under the amended JSE rules, a JSE GAAP Monitoring Panel will have the authority to sanction listed companies for non-compliance with either SA GAAP or IFRS.

 

IFAC noted that using ISAs as a common base would require auditors to both:

• perform a financial statement audit in accordance with ISAs, and
• perform additional procedures and report on additional matters in response to specific legal, regulatory, or other needs established at a national level.

She will be responsible for assisting in the preparation of explanatory and educational materials related to IFRS, for assuring the quality of educational products carrying the IASC Foundation logo, for general educational activities, and for assisting the IASCF Trustees in a possible proficiency-testing programme. Click for Press Release (PDF 19k).

The meeting will be held at the Board's offices, 30 Cannon Street, London. On the agenda are the following topics:

• IFRIC issues (including decommissioning liabilities and reimbursements)
• Leases (research project)
• Revenue Recognition (joint research project with FASB)
• Financial Instruments (amendments to IAS 32 and IAS 39)
• Share-Based Payment (redeliberations of proposals in ED 2)
• Convergence (issues relating to IAS 19, IAS 37, asset disposals, discontinuing operations)
• The Income Statement [Reporting Performance] (UK pilot field tests)
• Financial Activities (risk disclosures and other issues)
• Business Combinations - Phase II (noncontrolling interest, comment period, effective date, transition)

The meeting resulted in a Statement (PDF 10k) backing, among other things, the development of international accounting standards as a means to bolster investor confidence: "We favour the emergence, through open and public processes involving the private sector, of high-quality internationally recognized accounting standards that are applied, interpreted and enforced, with due regard to financial stability concerns." The finance ministers' meeting is a prelude to a summit of the G8 heads of state and government that will take place on 1 to 3 June at Evian. The G8 countries are Canada, France, Germany, Italy, Japan, Russia, United Kingdom, and United States.

The PCAOB was created by the Sarbanes-Oxley Act of 2002. Its mission is to protect investors in US securities markets by ensuring that public company financial statements are audited according to the highest standards of quality, independence, and ethics (whether by domestic or foreign auditors). The PCAOB's primary regulatory tools are:

• Registration of auditing firms.
• Auditing and other professional standards.
• Inspections of registered public accounting firms.
• Enforcement through investigations and disciplinary proceedings.

 

The FAS 150 classifications are essentially consistent with the classifications under IAS 32 and IAS 39 (as proposed to be amended). Also, because FAS 150 has a limited scope, it does not address a number of liability-equity questions that are addressed under IAS 32 and IAS 39, such as accounting for compound instruments and for contingently redeemable instruments, but the FASB intends to address those issues in a later phase of the project. Under FAS 150, three types of instruments would be classified as liabilities by the issuer:

• Mandatorily redeemable shares.
• Instruments that do or may require the issuer to buy back some of its shares in exchange for cash or other assets.
• Obligations that can be settled with shares, the monetary value of which is fixed, tied solely or predominantly to a variable such as a market index, or varies inversely with the value of the issuers' shares.

While both boards have concluded that compensation cost should be recognised over the service period, the measurement technique proposed by the IASB in ED 2 (units-of-service attribution method) differs from the modified grant-date measurement approach in FASB Statement 123. The FASB has now considered both approaches and has decided to keep the FAS 123 method:

"Compensation cost would be adjusted to reflect actual forfeitures and outcomes of performance conditions. The method of attribution would be consistent with the approach presented in Statement 123 rather than by the units-of-service attribution method proposed in IASB Exposure Draft 2, Share-based Payment. For awards with service conditions, an enterprise would base accruals of compensation cost on the best available estimate of the number of equity instruments that are expected to vest and to revise that estimate, if necessary, if subsequent information indicates that actual forfeitures are likely to differ from initial estimates."

Draft Interpretation D1, Emission Rights, is IFRIC's first draft Interpretation. Comment deadline is 14 July 2003. D1 would require companies to account for the emission allowances they receive from governments as intangible assets, recorded initially at fair value. Emissions of pollutant would then give rise to a liability for the obligation to deliver allowances to cover those emissions. Any excess of the fair value of the allowance over the amount paid to the government is initially recognised as deferred income in the balance sheet and subsequently recognised as income on a systematic basis over the compliance period (per IAS 20). Click for Press Release (PDF 29k). The draft Interpretation will be available publicly on IASB's Website on 16 May. More Information.

Topics covered include FASB's new derivatives standard, SFAS 133 implementation issues, one new and six proposed FASB Staff Positions (FSPs), recent SEC activities, and summaries of recent FASB, AcSEC, and IASB meetings.