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June 2024 IASB meeting notes posted

25 Jun 2024

The IASB met in London on 19-20 June 2024 and held a joint education meeting with the US Financial Accounting Standards Board (FASB) on 21 June 2024. We have posted our comprehensive Deloitte observer notes for all projects discussed during the meeting.

The following topics were discussed:

Management commentary: The IASB decided unanimously to finalise the project by making targeted refinements to the proposals in the exposure draft (ED).

Post-implementation review (PIR) of IFRS 16 Leases: The IASB discussed the objective, activities and expected time line for the first phase of the PIR.

Dynamic risk management: The IASB made decisions on capacity assessment and presentation requirements. The IASB also discussed disclosure requirements on the DRM model but did not make any decisions on those.

Equity method: The IASB decided on sweep issues identified from the review comments of the pre-ballot draft of the equity method ED. Most significantly, the IASB decided by casting vote of the Chair not to add to the scope of the project the application question ‘in which order does an investor or joint venturer that has previously reduced the carrying amount of the investment to nil, recognise its share of the associate’s or joint ventures comprehensive profits that exceed its share of losses not recognised?’.

Provisions—targeted improvements: The IASB decided on three sweep issues arising as a consequence of its tentative decisions in the project. The IASB also made decisions about the transition requirements for the proposed amendments and confirmed that the due process has been followed in developing the proposed amendments. The ED will have a comment period of 120 days.

Pollutant pricing mechanisms: The IASB received an update on horizon scanning activities in relation to pollutant pricing mechanisms. As a next step, the IASB will decide whether to prioritise a project on pollutant pricing mechanisms.

Work plan update: The IASB received an update on its work plan and on its recent digital financial reporting activities.

Joint education session with the FASB: The IASB and the FASB discussed their respective PIRs of their revenue and leases standards.

Please click to access the detailed notes taken by Deloitte observers for the entire meeting. An analysis of how the work plan of the IASB has changed as a result of the meeting is available here.

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New and revised pronouncements as at 30 June 2024

25 Jun 2024

Our popular summary of new and revised financial and sustainability reporting requirements, updated for financial reporting periods ending on 30 June 2024. This listing can be used to perform a quick check that new financial and sustainability reporting requirements such as new and revised accounting and sustainability disclosure standards and interpretations, and amendments to standards and interpretations, have been fully considered in the reporting close process. The information below can also be used to assist with the disclosure requirements under paragraph 30 of IAS 8 'Accounting Policies, Changes in Accounting Estimates and Errors', which requires entities to disclose any new IFRSs that are in issue but not yet effective and which are likely to impact the entity.

Financial reporting considerations related to the Russia-Ukraine War
Below is our usual analysis of new and amended standards, however, we are also aware that many entities will have been impacted by Russia's invasion into Ukraine. Please see our IFRS in Focus — Financial reporting considerations related to the Russia-Ukraine War highlighting some of the key issues to be considered by the entities in preparing their financial statements.

This table can be used for all annual accounting periods. A 1st quarter ending on 30 June 2024 would mean that the annual reporting period began on 1 April 2024. Similarly, 2nd quarters ending on 30 June 2024 refer to annual periods that began on 1 January 2024, 3rd quarters ending on 30 June 2024 refer to annual periods that began on 1 October 2023, and 4th quarters ending on 30 June 2024 refer to annual periods that began on 1 July 2023.

The information below reflects developments to 25 June 2024 and will be updated through to September 2024 to reflect new and revised financial and sustainability reporting requirements that need to be considered for reporting periods ending on 30 June 2024. For accounts approved after June 2024, please also refer to subsequent versions of this document for any new and revised IFRSs that have additionally been issued that might require disclosure in the accounts under IAS 8:30.

The information below is organised as follows:

 

Summary

Pronouncements applicable to entities applying IFRSs at the IASB effective dates

The table below provides a summary of the pronouncements which will be mandatorily applied by entities for the first time at 30 June 2024, for various quarterly reporting periods:

Pronouncement Effective date* Mandatory at 30 June 2024?
1st qtrs 2nd qtrs 3rd qtrs Full yrs
STANDARDS
IFRS 17 Insurance Contracts 1 January 2023 ** ** Yes Yes
IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information 1 January 2024 Yes Yes - -
IFRS S2 Climate-related Disclosures 1 January 2024 Yes Yes - -
AMENDMENTS
Amendments to IFRS 17 1 January 2023 ** ** Yes Yes
Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2) 1 January 2023 ** ** Yes Yes
Definition of Accounting Estimates (Amendments to IAS 8) 1 January 2023 ** ** Yes Yes
Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12) 1 January 2023 ** ** Yes Yes
Initial Application of IFRS 17 and IFRS 9 — Comparative Information (Amendment to IFRS 17) available on first application of IFRS 17 Optional Optional Optional Optional
International Tax Reform — Pillar Two Model Rules (Amendments to the 'IFRS for SMEs' Standard)  — Application of the exception and disclosure of that fact issued on 29 September 2023 with immediate effectiveness ** ** ** Yes
Classification of Liabilities as Current or Non-Current (Amendments to IAS 1) 1 January 2024 Yes Yes - -
Lease Liability in a Sale and Leaseback (Amendments to IFRS 16) 1 January 2024 Yes Yes - -
Non-current Liabilities with Covenants (Amendments to IAS 1) 1 January 2024 Yes Yes - -
Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7) 1 January 2024 Yes Yes - -

* Generally annual periods beginning on or after the date indicated, may only apply to first-time adopters in some limited cases (see the detailed information for each pronouncement below for full details).

** This pronouncement has already been implemented in previous periods by entities with this reporting date (where it applied to the entity).

More information about these pronouncements, and all new and revised pronouncements, is set out below.

 

Financial statement considerations in adopting new and revised pronouncements

Where new and revised pronouncements are applied for the first time, there can be consequential impacts on annual financial statements, including:

  • Impact of transitional provisions. IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors contains a general requirement that changes in accounting policies are retrospectively applied, but this does not apply to the extent an individual pronouncement has specific transitional provisions.
  • Disclosures about changes in accounting policies. Where an entity changes its accounting policy as a result of the initial application of an IFRS and it has an effect on the current period or any prior period, IAS 8 requires the disclosure of a number of matters, e.g. the title of the IFRS, the nature of the change in accounting policy, a description of the transitional provisions, and the amount of the adjustment for each financial statement line item affected
  • Third statement of financial position. IAS 1 Presentation of Financial Statements requires the presentation of a third statement of financial position as at the beginning of the preceding period in addition to the minimum comparative financial statements in a number of situations, including if an entity applies an accounting policy retrospectively and the retrospective application has a material effect on the information in the statement of financial position at the beginning of the preceding period
  • Earnings per share (EPS). Where applicable to the entity, IAS 33 Earnings Per Share requires basic and diluted EPS to be adjusted for the impacts of adjustments result from changes in accounting policies accounted for retrospectively and IAS 8 requires the disclosure of the amount of any such adjustments.

Whilst disclosures associated with changes in accounting policies resulting from the initial application of new and revised pronouncements are less in interim financial reports under IAS 34 Interim Financial Reporting, some disclosures are required, e.g. description of the nature and effect of any change in accounting policies and methods of computation.

 

New or revised standards


IFRS 17 Insurance Contracts

IFRS 17 requires insurance liabilities to be measured at a current fulfillment value and provides a more uniform measurement and presentation approach for all insurance contracts. These requirements are designed to achieve the goal of a consistent, principle-based accounting for insurance contracts. IFRS 17 supersedes IFRS 4 Insurance Contracts as of 1 January 2023.

Issued: 18 May 2017

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2023
Endorsed for use in the EU, albeit with an optional exemption from applying the annual cohort requirement.

First quarters ending 30 June 2024:

[Note 1]

Second quarters ending 30 June 2024:

[Note 1]

Third quarters ending 30 June 2024:

Mandatory

Annual periods ending 30 June 2024:

Mandatory


IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information

IFRS S1 sets out overall requirements for sustainability-related financial disclosures with the objective to require an entity to disclose information about its sustainability-related risks and opportunities that is useful to primary users of general purpose financial reports in making decisions relating to providing resources to the entity.

Issued: 26 June 2023 

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2024
Will not be endorsed for use in the EU

First quarters ending 30 June 2024:

Mandatory

Second quarters ending 30 June 2024:

Mandatory

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


IFRS S2 Climate-related Disclosures

IFRS S2 sets out the requirements for identifying, measuring and disclosing information about climate-related risks and opportunities that is useful to primary users of general purpose financial reports in making decisions relating to providing resources to the entity.

Issued: 26 June 2023 

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2024
Will not be endorsed for use in the EU

First quarters ending 30 June 2024:

Mandatory

Second quarters ending 30 June 2024:

Mandatory

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


IFRS 18 Presentation and Disclosures in Financial Statements

IFRS 18 includes requirements for all entities applying IFRS for the presentation and disclosure of information in financial statements.

Issued: 9 April 2024 

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2027
Not yet endorsed for use in the EU

First quarters ending 30 June 2024:

Optional

Second quarters ending 30 June 2024:

Optional

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


IFRS 19 Subsidiaries without Public Accountability: Disclosures

IFRS 19 specifies the disclosure requirements an eligible subsidiary is permitted to apply instead of the disclosure requirements in other IFRS Accounting Standards.

Issued: 9 May 2024 

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2027
Not yet endorsed for use in the EU

First quarters ending 30 June 2024:

Optional

Second quarters ending 30 June 2024:

Optional

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


 

 

Amendments


Classification of Liabilities as Current or Non-Current (Amendments to IAS 1)

The amendments aim to promote consistency in applying the requirements by helping companies determine whether, in the statement of financial position, debt and other liabilities with an uncertain settlement date should be classified as current (due or potentially due to be settled within one year) or non-current.

Issued: 23 January 2020

Effective date:

Annual reporting periods beginning on or after 1 January 2024 

First quarters ending 30 June 2024:

Mandatory

Second quarters ending 30 June 2024:

Mandatory

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


Amendments to IFRS 17

Amends IFRS 17 to address concerns and implementation challenges that were identified after IFRS 17 Insurance Contracts was published in 2017. The main changes are:

  • Deferral of the date of initial application of IFRS 17 by two years to annual periods beginning on or after 1 January 2023
  • Additional scope exclusion for credit card contracts and similar contracts that provide insurance coverage as well as optional scope exclusion for loan contracts that transfer significant insurance risk
  • Recognition of insurance acquisition cash flows relating to expected contract renewals, including transition provisions and guidance for insurance acquisition cash flows recognised in a business acquired in a business combination
  • Clarification of the application of IFRS 17 in interim financial statements allowing an accounting policy choice at a reporting entity level
  • Clarification of the application of contractual service margin (CSM) attributable to investment-return service and investment-related service and changes to the corresponding disclosure requirements
  • Extension of the risk mitigation option to include reinsurance contracts held and non-financial derivatives
  • Amendments to require an entity that at initial recognition recognises losses on onerous insurance contracts issued to also recognise a gain on reinsurance contracts held
  • Simplified presentation of insurance contracts in the statement of financial position so that entities would present insurance contract assets and liabilities in the statement of financial position determined using portfolios of insurance contracts rather than groups of insurance contracts
  • Additional transition relief for business combinations and additional transition relief for the date of application of the risk mitigation option and the use of the fair value transition approach

Issued: 25 June 2020

Effective date:

Annual reporting periods beginning on or after 1 January 2023

First quarters ending 30 June 2024:

[Note 1]

Second quarters ending 30 June 2024:

[Note 1]

Third quarters ending 30 June 2024:

Mandatory

Annual periods ending 30 June 2024:

Mandatory


Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)

The amendments require that an entity discloses its material accounting policies, instead of its significant accounting policies. Further amendments explain how an entity can identify a material accounting policy. Examples of when an accounting policy is likely to be material are added. To support the amendment, the Board has also developed guidance and examples to explain and demonstrate the application of the ‘four-step materiality process’ described in IFRS Practice Statement 2.

Issued: 12 February 2021

Effective date:

Annual reporting periods beginning on or after 1 January 2023
Endorsed for use in the EU, however, as practice statements are not endorsed for application in the European Union, the amendments to IFRS Practice Statement 2 have not been endorsed.

First quarters ending 30 June 2024:

[Note 1]

Second quarters ending 30 June 2024:

[Note 1]

Third quarters ending 30 June 2024:

Mandatory

Annual periods ending 30 June 2024:

Mandatory


Definition of Accounting Estimates (Amendments to IAS 8)

The amendments replace the definition of a change in accounting estimates with a definition of accounting estimates. Under the new definition, accounting estimates are “monetary amounts in financial statements that are subject to measurement uncertainty”. Entities develop accounting estimates if accounting policies require items in financial statements to be measured in a way that involves measurement uncertainty. The amendments clarify that a change in accounting estimate that results from new information or new developments is not the correction of an error.

Issued: 12 February 2021

Effective date:

Annual reporting periods beginning on or after 1 January 2023

First quarters ending 30 June 2024:

[Note 1]

Second quarters ending 30 June 2024:

[Note 1]

Third quarters ending 30 June 2024:

Mandatory

Annual periods ending 30 June 2024:

Mandatory


Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12)

The amendments clarify that the initial recognition exemption does not apply to transactions in which equal amounts of deductible and taxable temporary differences arise on initial recognition.

Issued: 7 May 2021 

Effective date:

Annual reporting periods beginning on or after 1 January 2023

First quarters ending 30 June 2024:

[Note 1]

Second quarters ending 30 June 2024:

[Note 1]

Third quarters ending 30 June 2024:

Mandatory

Annual periods ending 30 June 2024:

Mandatory


Initial Application of IFRS 17 and IFRS 9 — Comparative Information (Amendment to IFRS 17)

The amendment permits entities that first apply IFRS 17 and IFRS 9 at the same time to present comparative information about a financial asset as if the classification and measurement requirements of IFRS 9 had been applied to that financial asset before.

Issued: 9 December 2021

Effective date:

An entity that elects to apply the amendment applies it when it first applies IFRS 17

First quarters ending 30 June 2024:

Optional

Second quarters ending 30 June 2024:

Optional

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)

The amendment clarifies how a seller-lessee subsequently measures sale and leaseback transactions that satisfy the requirements in IFRS 15 to be accounted for as a sale.

Issued: 22 September 2022

Effective date:

Annual reporting periods beginning on or after 1 January 2024

First quarters ending 30 June 2024:

Mandatory

Second quarters ending 30 June 2024:

Mandatory

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


Non-current Liabilities with Covenants (Amendments to IAS 1)

The amendment clarifies how conditions with which an entity must comply within twelve months after the reporting period affect the classification of a liability.

Issued: 31 October 2022

Effective date:

Annual reporting periods beginning on or after 1 January 2024

First quarters ending 30 June 2024:

Mandatory

Second quarters ending 30 June 2024:

Mandatory

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7)

The amendments add disclosure requirements, and ‘signposts’ within existing disclosure requirements, that ask entities to provide qualitative and quantitative information about supplier finance arrangements.

Issued: 25 May 2023

Effective date:

Annual reporting periods beginning on or after 1 January 2024

First quarters ending 30 June 2024:

Mandatory

Second quarters ending 30 June 2024:

Mandatory

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


Lack of Exchangeability (Amendments to IAS 21)

The amendments contain guidance to specify when a currency is exchangeable and how to determine the exchange rate when it is not.

Issued: 15 August 2023

Effective date:

Annual reporting periods beginning on or after 1 January 2025
Not yet endorsed for use in the EU

First quarters ending 30 June 2024:

Optional

Second quarters ending 30 June 2024:

Optional

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


International Tax Reform — Pillar Two Model Rules (Amendments to the 'IFRS for SMEs' Standard)

The amendments align the standard's requirements with similar amendments to IAS 12 Income Taxes issued in May 2023.

Issued: 29 September 2023

Effective date:

The application of the exception and disclosure of that fact is effective immediately, the other disclosure requirements are effective for annual reporting periods beginning on or after 1 January 2023, but not required in any interim financial statements for 2023
Will not be endorsed for use in the EU

First quarters ending 30 June 2024:

[Note 1]

Second quarters ending 30 June 2024:

[Note 1]

Third quarters ending 30 June 2024:

[Note 1]

Annual periods ending 30 June 2024:

Mandatory (exception)


Amendments to the SASB standards to enhance their international applicability

The amendments remove and replace jurisdiction-specific references and definitions in the SASB standards, without substantially altering industries, topics or metrics

Issued: 19 December 2023 

Effective date:

Annual reporting periods beginning on or after 1 January 2025
Will not be endorsed for use in the EU

First quarters ending 30 June 2024:

Optional

Second quarters ending 30 June 2024:

Optional

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


Amendments IFRS 9 and IFRS 7 regarding the classification and measurement of financial instruments

The amendments address matters identified during the post-implementation review of the classification and measurement requirements of IFRS 9 Financial Instruments.

Issued: 30 May 2024 

Effective date:

Annual reporting periods beginning on or after 1 January 2026
Not yet endorsed for use in the EU

First quarters ending 30 June 2024:

Optional

Second quarters ending 30 June 2024:

Optional

Third quarters ending 30 June 2024:

Optional

Annual periods ending 30 June 2024:

Optional


Editorial Corrections (various)

The IASB periodically issues Editorial Corrections and changes to IFRSs and other pronouncements. Since the beginning of calendar 2021, such corrections have been made in June 2021, October 2021, December 2021, January 2022, July 2022, October 2022, August 2023, and September 2023.

Note: For details of these editorial corrections, see our IASB editorial corrections page.

Effective date:

As minor editorial corrections, these changes are effectively immediately applicable under IFRS


 

 

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Agenda for the June 2024 IRCC meeting

24 Jun 2024

An agenda has been released for the meeting of the Integrated Reporting and Connectivity Council (IRCC) that will be held by video conference call on 26 June 2024.

A summary of the agenda is set out below:

Wednesday 26 June 2024 (13:30-16:00)

  • Progress report
  • Management commentary
  • Integrated thinking and reporting
  • Break out group discussions:
    • Integrated reporting engagement
    • Management commentary

Agenda papers for the meeting are available on the IFRS Foundation website.

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Updated IASB and ISSB work plan — Analysis (June 2024)

24 Jun 2024

Following the IASB and ISSB meetings this month, we have analysed the work plan on the IFRS Foundation website to see what changes have resulted from the meetings and other developments since the work plan was last revised in May 2024. Several developments are expected to occur in July 2024.

Below is an analysis of all changes made to the work plan since our last analysis on 28 May 2024.

Standard-setting projects

  • Management commentary — the IASB has decided to finalise the management commentary project by issuing targeted improvements to the practice statement (expected in H1 2025)

Maintenance projects

  • Amendments to the classification and measurement of financial instruments — final amendments were issued on 30 May 2024, the project has, therefore, been removed from the work plan
  • Power purchase agreements — the discussion of the feedback received is now expected to begin in August 2024 (previously Q3 2024)
  • Provisions — Targeted improvements — an exposure draft is now expected in Q4 2024 (previously H2 2024)

Research projects

  • Post-implementation review of IFRS 16 — a new entry indicates that a request for information is now expected in H1 2025

Governance

  • ISSB consultation on agenda priorities — this project has been removed from the work plan since the ISSB concluded the project today by publishing a feedback statement

Other projects

  • IFRS Accounting Taxonomy Update — Contracts for renewable electricity — newly added to the work plan, a proposed taxonomy update is expected in August 2024 (the DPOC agreed to have a proposed taxonomy updated to be developed based on the exposure draft)

Developments expected to occur in July 2024

  • Exposure draft on annual improvements to IFRS accounting standards
  • Exposure draft on climate-related and other uncertainties in the financial statements
  • Decision on the project direction on financial instruments with characteristics of equity
  • Feedback statement on the post-implementation review of IFRS 9 — Impairment
  • Exposure draft for updating IFRS 19
  • Exposure draft on the use of a hyperinflationary presentation currency by a non-hyperinflationary entity (IAS 21)

The above is a faithful comparison of the IASB and ISSB work plan at 28 May 2024 and 24 June 2024. For access to the current work plan at any time, please click here.

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Agenda for the July 2024 ASAF meeting

24 Jun 2024

The IFRS Foundation has released an agenda and meeting papers for the meeting of the Accounting Standards Advisory Forum (ASAF), which will be held in London on 8-9 July 2024.

A summary of the agenda is set out below:

Monday 8 July 2024 (9:45-17:45)

  • Agenda planning and feedback from previous ASAF meetings
  • Financial instruments with characteristics of equity 
    • Feedback statement
  • Provisions — Targeted Improvements
    • Project update
    • Present obligation
    • Threshold-triggered costs
    • Discount rates — application guidance
    • Discount rates — disclosure requirements
    • Indicative drafting — IAS 37
    • Indicative drafting — decision tree
  • Power purchase agreements
    • Exposure draft on contracts for renewable electricity
  • Business combinations — Disclosures, goodwill and impairment
    • Outreach on the exposure draft

Tuesday 9 July 2024 (9:30-16:00)

  • Carbon credits
    • Carbon credits research — AcSB presentation
    • Carbon credits research — FASB presentation
  • Pollutant pricing mechanisms
    • Horizon scanning activities and feedback summary
    • Summary of feedback — national standard-setters
    • Pollutant pricing mechanisms survey and questionnaire
  • Intangible assets
    • UKEB’s project on intangible assets — UKEB presentation
    • Project scope and approach
 

Agenda papers for the meeting are available on the IFRS Foundation website.

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ISSB concludes agenda consultation by releasing a feedback statement

24 Jun 2024

On 4 May 2023, the International Sustainability Standards Board (ISSB) launched its first public consultation to seek broad public input on the strategic direction and overall balance of its future work programme as well as sustainability-related matters the ISSB could take up.

 

Background

The ISSB consultation on agenda priorities was first discussed in July 2022 and it was decided that the ISSB would develop and pursue its initial work plan subject to public consultation on agenda priorities.

The ISSB decided to publish a request for information to gather views on:

  1. the strategic direction and balance of ISSB activities;
  2. the suitability of proposed criteria for assessing the priority of sustainability-related matters (including topics, industries and activities) that could be added to the ISSB’s work plan; and
  3. a proposed list of sustainability-related matters (including topics, industries and activities) that could be added to the ISSB’s work plan.

 

Feedback on the request for information and ISSB decisions

On the areas consulted on in the request for information, the ISSB received the following feedback and reacted by making the following decisions:

Strategic direction and balance of the ISSB’s activities Feedback indicated that most stakeholders viewed supporting the implementation of IFRS S1 and IFRS S2 as the highest priority for the ISSB in the next two years. The ISSB decided to place a high level of focus on supporting the implementation of IFRS S1 and IFRS S2 and  to place a slightly lower level of focus on enhancing the SASB Standards and beginning new research projects.
Criteria for assessing sustainability reporting matters that could be added to the ISSB’s work plan Most respondents agreed that the criteria identified by the ISSB were appropriate. A few respondents said the criteria should include considerations related to interoperability, differing concepts of materiality, global applicability and connectivity to the IASB’s work plan. The ISSB decided to make no substantive changes to six of the seven criteria proposed in the request for information and to change the criterion on how the proposed project relates to other projects to make it explicit that the ISSB will consider the work of other relevant standard-setters.
New research and standard-setting projects that could be added to the ISSB’s work plan One of the two core sections of the request for information. It contained general considerations and introduced potential projects on (i) biodiversity, ecosystems and ecosystem services, (ii) human capital, and (iii) human rights. For each topic, subtopics were identified and respondents were asked to prioritise them. Respondents had mixed views on the project or set of projects the ISSB should prioritise. Most respondents supported the ISSB prioritising at least one of the proposed projects identified in the request for information, but views on the relative priority of each project were mixed. The ISSB decided to add to its work plan research projects on risks and opportunities associated with biodiversity, ecosystems and ecosystem services as well as human capital.
Integration in reporting
The other core section of the request for information. While originally a joint project with the IASB on connectivity in reporting building on the IASB’s management commentary project and the Integrated Reporting Framework was envisaged, the request for information warned that such a project could be resource-intensive and asked whether such a project (joint or ISSB-only) should be part of the initial two-year work plan of the ISSB. Feedback from respondents indicated that although integration in reporting is important to many stakeholders, it is not a matter of priority for most investors. Approximately two-thirds of investors said a project on integration in reporting should be a lower priority for the ISSB or made no comment on integration in reporting and asked the ISSB to focus on other activities. In response to this feedback, the ISSB noted that it could continue to build on the significant accomplishments of IFRS S1 and IFRS S2 in providing connections in information between sustainability-related financial disclosures and financial statements and reiterated its support for the continued use and adoption of the Integrated Reporting Framework.

     

    Additional information

    The following additional information is available on the IFRS Foundation website website and on IAS Plus:

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    TNFD and EFRAG publish correspondence mapping

    20 Jun 2024

    The Taskforce on Nature-related Financial Disclosures (TNFD) and EFRAG have jointly published a mapping of the correspondence between the European Sustainability Reporting Standards (ESRS) and the TNFD's recommended disclosures and metrics.

    EFRAG and TNFD have collaborated closely to maximise the consistency of the ESRS environmental standards and the TNFD recommendations as they were being developed in parallel with the ESRS issued in July 2023 and the TNFD recommendations in September 2023.

    The mapping shows the high level of correspondence between the ESRS and the TNFD recommendations:

    • Concepts and definitions: Both, the TNFD and ESRS, recommend the need to disclose nature-related impacts, risks and opportunities, including dependencies on nature to the extent that they generate material risks. 
    • Approach to materiality: The ESRS require disclosures to be based on a double materiality principle. The TNFD approach enables different approaches to materiality, including the double materiality approach. 
    • The LEAP approach: The TNFD developed the LEAP approach for market participants to identify and assess their nature-related issues. The ESRS state that companies may conduct their materiality assessment on the sustainability matters of pollution, water, biodiversity and ecosystems, and circular economy using the LEAP approach.
    • Reporting pillars: Both, the TNFD recommended disclosures and the ESRS reporting areas, are organised around the four disclosure pillars of the Task Force on Climate-related Financial Disclosures (TCFD).
    • Recommended disclosures and metrics: All 14 disclosures recommended by the TNFD are reflected in the ESRS. 

    Please click to access the mapping through the press release on the EFRAG website.

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    Agenda for the July 2024 ITCG meeting

    20 Jun 2024

    The IFRS Foundation has released an agenda and meeting papers for the meeting of the IFRS Taxonomy Consultative Group (ITCG), which will be held in a hybrid format (in London and virtual) on 2 July 2024.

    A summary of the agenda is set out below:

    Tuesday 2 July 2024 (10:45-15:15)

    • Update on the review of the IFRS Taxonomy Due Process, specifically within the context of the power purchase agreements project
    • Fieldwork for the IFRS Accounting Taxonomy 2024 Proposed Update 1—IFRS 18 Presentation and Disclosure in Financial Statements
    • Exploring the approach to the IFRS Accounting Taxonomy transition for IFRS 18 and approach to taxonomy entry points including the IFRS for SMEs standard
    • US Financial Accounting Standards Board (FASB): 2024 GAAP Meta Model Relationships Taxonomy
    • Update on digital financial reporting activities
    • Global Sustainability Standards Board: Briefing on the Global Reporting Initiative digital taxonomy

    Agenda papers for the meeting are available on the IFRS Foun­da­tion website.

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    Recordings from the Sustainability Standards Conference 2024

    19 Jun 2024

    Recordings have been published from the Sustainability Standards Conference 2024 that was held on 10 June 2024.

    The conference was held by the IFRS Foundation and the International Sustainability Standards Board (ISSB) together with the Deutsches Rechnungslegungs Standards Committee (the German Accounting Standards Committee), the Leibniz Institute for Financial Research SAFE (Sustainable Architecture for Finance in Europe) (part of the House of Finance of Goethe University Frankfurt) and the Deutsche Börse Group.

    The conference explored topics related to the ISSB’s current standard-setting agenda from both a practical and an academic perspective.

    The recordings of the conference are available on YouTube.

    IFRS IC meeting (blue) Image

    IFRS Interpretations Committee holds June 2024 meeting

    19 Jun 2024

    The IFRS Interpretations Committee (IFRS IC) met in London on 11 June 2024. The IFRS IC discussed the finalisation of an agenda decision and a new item, and gave input for two IASB projects.

    Finalisation of agenda decision—IFRS 8 Operating Segments—Disclosure of Revenues and Expenses for Reportable Segments: In its November 2023 meeting, the IFRS IC discussed a submission about the application of IFRS 8:23 which requires an entity to report a measure of profit or loss for each reportable segment and to disclose specified amounts for each reportable segment. The staff concluded that i) an entity is required to disclose the specified amounts in IFRS 8:23(a)-(i) for each reportable segment if those amounts are included in the measure of segment profit or loss or regularly provided to the chief operating decision maker (CODM); and ii) in applying IFRS 8:23(f) by disclosing, for each reportable segment, material items of income and expense disclosed, entities determine what is considered “material” in accordance with IAS 1. In the November 2023 meeting, IFRS IC members agreed with i) above but raised their concerns on ii). 27 comment letters were received. Most of them agreed with the conclusion in i) above. However, the majority disagreed with the interpretation in ii). The staff continued to agree with the analysis in the tentative agenda decision with further explanation. The IFRS IC decided to finalise the agenda decision with some suggested changes. 

    Initial considerationIAS 7 Statement of Cash Flows—Classification of Cash Flows related to Margin Calls on “Collateralised-to-Market” Contract: The IFRS IC received a submission about whether an entity presents, in the statement of cash flows, the cash flows related to variation margin call payments on contracts to purchase or sell commodities at a predetermined price in the future as cash flows from activities other than operating or operating activities. The staff concluded that the fact pattern described is unlikely to become widespread and/or have a material effect in the future. The IFRS IC agreed with this analysis and decided to publish a tentative agenda decision to explain the reasons for not adding a standard-setting project.

    IFRS IC input to IASB projects:

    Intangible Assets: A research project on intangible assets has recently been added to the IASB’s work plan. In the initial phase of the project, the IASB is seeking input on the problem that it is trying to solve, the scope of the project and how best to stage work to deliver timely improvements. During the meeting, IFRS IC members provided their input to the areas requested.

    Business Combinations—Disclosures, Goodwill and Impairment: IFRS IC members provided their input to the questions asked on different aspects (i.e. identifying strategic business combinations, exemption and impairment test) of the IASB’s proposals included in the Exposure Draft Business Combinations—Disclosures, Goodwill and Impairment.

    More In­for­ma­tion

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

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