Most importantly, EFRAG believes that the effective date of IFRS 17 should be postponed to 1 January 2023, however, early application should be permitted so that companies can apply the standard before that date. The comment letter notes:

EFRAG welcomes the IASB’s decision to defer the effective date of IFRS 17. However, EFRAG disagrees with 1 January 2022 as the effective date. EFRAG considers that 1 January 2023 is a realistic effective date, with early application permitted.

Other than that, EFRAG is supportive of many of the changes proposed, even though the comment letter mentions several remaining concerns.  EFRAG also expresses its appreciation for the consideration of the topics identified in its letter sent to the IASB in September 2018. EFRAG believes that two issues warrant further consideration:

• EFRAG believes that the annual cohort requirement leads to unnecessary costs in some fact patterns. EFRAG recommends that the IASB consider developing an appropriate solution for them, reflective of the reporting objectives of the level of aggregation requirements and of their economic characteristics.
• EFRAG remains concerned about implementation challenges faced by preparers when applying the modified retrospective approach and encourages the IASB to confirm in the main text of the final standard that the use of estimates is allowed, including those needed to approximate the missing information.

Please click to access the press release and the final comment letter on the EFRAG website.

The publication maps the better alignment project participants’ standards and frameworks against the seven principles for effective disclosure, the 11 recommended disclosures and 50 illustrative example metrics detailed in the recommendations published by the Task Force on Climate-related Financial Disclosure (TCFD) in June 2017. It also documents the commonalities and differences between the participants within the parameters of the TCFD recommendations’ example metrics.

Participants of the CRD project on better alignment are the Carbon Disclosure Project (CDP), the Climate Disclosure Standards Board (CDSB), the Global Reporting Initiative (GRI), the International Integrated Reporting Council (IIRC), and the Sustainability Accounting Standards Board (SASB). Additional members of the CRD are the Financial Accounting Standards Board (FASB, observer), the International Accounting Standards Board (IASB), and the International Organization for Standardization (ISO).

The mapping in the report shows strong alignment between the participants’ frameworks and standards and the TCFD recommendations, specifically:

• The TCFD’s seven ‘Principles for Effective Disclosures’ are harmonious and complementary with those of the participants’ frameworks and standards, with the mapping showing no sources of conflict.
• The participants are well-aligned with the TCFD’s 11 recommended disclosures, each of which is comprehensively covered by the frameworks and standards.
• Overall, 80% of the TCFD’s 50 illustrative metrics are fully or reasonably covered by CDP, GRI and SASB indicators.
• There are high levels of alignment between CDP, GRI and SASB for the TCFD’s illustrative example metrics, with 70% of the TCFD’s 50 metrics showing no substantive difference between the participants’ indicators. For the remaining 15 indicators, substantive differences are limited.

The full report can be downloaded here and will be presented at two webinars on 10 October 2019. Participants must register for the webinars in advance to gain access. Please click for more information on the CRD website.

The Sustainability Accounting Standards Board (SASB) and the Climate Disclosure Standards Board (CDSB) have jointly released the TCFD Good Practice Handbook, a complement to the TCFD Implementation Guide, released in May 2019. The handbook provides real-world examples of TCFD reporting to help companies better understand how they can more effectively communicate with investors about the financially material climate-related risks and opportunities they face. Please click to download the handbook on the CDSB website.

The CDSB has also launched a climate-related financial disclosure e-learning platform designed to help organisations fill the knowledge gap and enhance their disclosures of climate-related information. Hosted on the TCFD Knowledge Hub, the e-learning courses will be CPD accredited and suitable for companies, investors and finance professionals. Please click for more information on the CDSB website.

The Association of Chartered Certified Accountants (ACCA), Chartered Accountants Australia and New Zealand (CAANZ) and Institute of Chartered Accountants of Scotland (ICAS) have jointly published Recommendations for SDG Disclosures: a consultation paper. The proposed recommendations for SDG Disclosure are designed to be both used in conjunction with existing reporting frameworks and neutral with respect to them. The recommendations are also SDG specific, recognising the complexity and interconnectedness of the sustainable development issues that the SDGs address. Please click for more information on the ACCA website.

The International Integrated Reporting Council (IIRC) has published its 2018 integrated report with, for the first time, limited assurance from an independent auditor. Please click for more information and access to the report on the IIRC website.

The Global Reporting Initiative (GRI) announces that the 2018 versions of two Standards - GRI 303 Water and Effluents and GRI 403 Occupational Health and Safety – have been translated into the Arabic language. All Arabic translations of GRI Standards are available here on the GRI website.

The full agenda for the meeting is sum­marised below:

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

The participants discussed:

• Welcome and Chair's preview
• Effect of technology on the investment process
• Consistent adoption and application of IFRSs
• Effective risk management
• Update on Trustees and Foundation activities
• Update on the Board’s activities
• Digital experience for customers and stakeholders
• 2020 Agenda Consultation — Proposed approach
• Summing up of the meeting

The recordings from the meeting are available on the IASB website.

EFRAG has published a press release with a corresponding announcement and a draft of the draft endorsement advice to allow for prompt comments by European target groups.

Participants will discuss:

The presentations for the WSS meeting are available on the IASB website.

The meeting will be immediately followed by a meeting of the International Forum of Accounting Standard Setters (IFASS).

New Issues

The discussed three new issues.

IFRS 15 Revenue from Contracts with Customers—Training costs to fulfil a contract (Agenda Paper 2). Should training costs that are incurred by a supplier, that are necessary to be able to deliver a service to a customer and that are recoverable from the customer, be recognised as a contract asset?

IFRS 16 Leases—Definition of a lease—Shipping contract (Agenda Paper 3). Does a particular type of shipping contract contain a lease? 

IAS 21 The Effects of Changes in Foreign Exchange Rates and IAS 29 Financial Reporting in Hyperinflationary Economies—Translation of a hyperinflationary foreign operation (Agenda Paper 4) How does an entity, with a non-hyperinflationary presentation currency, present the information required by IAS 21 and IAS 29 for its interest in a foreign operation which is hyperinflationary?

The Committee decided not develop any Interpretations or amendments but instead publish tentative agenda decisions. 

Agenda decisions to finalise

The Committee finalised six tentative agenda decisions.

IFRS 15 Revenue from Contracts with Customers—Compensation for delays or cancellations (Agenda Paper 5). Should an obligation to compensate customers for delayed or cancelled flights (as set out in legislation) be recognised as part of the transaction price or as an obligation in accordance with IAS 37?

IAS 41 Agriculture—Subsequent expenditure (Agenda Paper 6). Should an entity capitalise or expense the costs related to the biological transformation of biological assets?

IAS 7 Statement of Cash Flows—Changes in liabilities arising from financing activities (Agenda Paper 7). Some investors have expressed concerns about the quality and consistency of disclosures about changes in liabilities arising from financing activities required by IAS 7.

IFRS 16 Leases—Incremental borrowing rate (Agenda Paper 8). Does the incremental borrowing rate need to reflect the interest rate in a loan with both a similar maturity to the lease and a similar payment profile to the lease payments?

IFRS 9 Financial Instruments—Fair value hedge of foreign currency risk on non-financial assets (Agenda Paper 9). Can foreign currency risk be a separately identifiable and reliably measurable risk component of a non-financial asset held for consumption (for example, property, plant and equipment and inventory denominated in a foreign currency) that an entity can designate as the hedged item in a fair value hedge accounting relationship?

IAS 1 Presentation of Financial Statements—Presentation of liabilities or assets related to an uncertain tax position (Agenda Paper 10). Should an entity present a liability related to uncertain tax treatments as a current (or deferred) tax liability or as a provision?

Work in progress (Agenda Paper 11)

There are no new matters that have not yet been presented to the Committee. The staff will present the analysis of comments of the tentative agenda decision 'Lease Term and Useful Life of Leasehold Improvements (IFRS 16 Leases and IAS 16 Property, Plant and Equipment)' at a future meeting.

More information

Please click to access the detailed notes taken by Deloitte observers for the entire meeting.

Onerous Contracts: After considering the comment letters received, the staff recommend that the Board finalise its amendments to IAS 37, to clarify that it is the costs that relate directly to the contract which are included in determining the ‘cost of fulfilling’ a contract for the purpose of assessing whether the contract is onerous.

Classification of Liabilities as Current or Non-current (Amendments to IAS 1): The staff recommend that the Board prepare the final amendments to IAS 1, with an effective date of 1 January 2022.

Business Combinations under Common Control: The staff recommend that the forthcoming Discussion Paper propose that an acquiring entity be required to account for a business combination under common control by applying either a current value approach based on the acquisition method or a predecessor approach. The current value approach would be required for transactions affecting non-controlling shareholders of the acquirer, with two exceptions, and the predecessor approach would apply for all other transactions.

Rate-regulated Activities: The Board will discuss the regulatory agreement boundary, whether any additional amendments to other IFRS Standards are necessary and the proposed transition requirements. 

Management Commentary: The staff recommend that the revised Practice Statement discuss faithful representation using three qualities of information—completeness, neutrality and freedom from error.

Disclosure Initiative: The Board is using IFRS 13 as one of the Standards to test the draft guidance on developing and drafting disclosure objectives and requirements and will discuss how the disclosure requirements could be improved.

Primary Financial Statements: The staff are recommending that the ED propose replacing IAS 1 with a new IFRS, rather than amending it, with fewer illustrative examples than previously envisaged.

SME standard review and update: The discussions will focus on the scope of the IFRS for SMEs Standard, IAS 19, IAS 23, IFRS 11, accounting for cryptocurrencies and accounting for financial guarantee contracts of the IFRS for SMEs Standard.

Extractive Activities: The staff will provide an overview of how changes to IFRS Standards and other documents, and other developments since the DP was published may affect the issues and conclusions in the DP. There are no staff recommendations.

Financial Instruments with Characteristics of Equity: After considering the feedback on the Discussion Paper the staff recommend that the Board develop amendments to IAS 32 to address practice, clarifying the underlying principles in IAS 32.

The Board will be given updates on the 2020 Agenda Consultation (the approach being proposed to developing the Request for Information), the planned Post-implementation review of IFRS 10, 11 and 12, the second phase of the project on IBOR Reform and the Effects on Financial Reporting, Subsidiaries that are SMEs and the Research Programme.

More information

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

The full agenda for the meeting is summarised below.