The Board discussed the following topics:
Tuesday 20 February
Disclosure initiative
The Board discussed the feedback received on the Disclosure Initiative—Principles of Disclosure Discussion Paper. There were 12 papers for this session, plus a cover note. No decisions were made.
Primary financial statements
The Board decided that entities should distinguish between cash flows from integral and non-integral associates and joint ventures in the investing section of the statement of cash flows.
However, after a 90 minute discussion the Board did not vote on the proposed clarification of what is meant by a ‘key performance measure’ and a measure that is ‘specified or defined in IFRS Standards’, or the related EPS disclosures. The Staff will reconsider their position and bring back further analysis, including researching how IAS 1.85 and 85A are being applied in practice.
Thursday 22 February
Dynamic risk management
The Board discussed the qualifying criteria for designating an item into the asset profile, which defines which items are managed for interest rate risk and are therefore subject to performance assessment under the DRM model. They also discussed some technicalities about designation and situations requiring de-designation, as well as documentation requirements. Some concerns were raised about how operational the proposals are and whether the proposals will allow entities to reflect how they manage risk.
Business combinations under common control
The Board decided to use the acquisition method in IFRS 3 as the starting point in developing proposals for accounting for business combinations for which all of the parties to the combination are under common control. In doing so it noted that the predominant accounting in practice is the predecessor approach and requiring the use of the acquisition method would be a significant change.
Research
The Board decided to start work in the next few months on variable and contingent consideration; provisions activities; pension benefits that depend on asset returns; and SMEs that are subsidiaries. Work on equity method; pollutant pricing mechanisms; high inflation (the scope of IAS 29); and post-implementation reviews of IFRS 10, 11 and 12; and IFRS 5 should commence in 2019 or early 2020. Most of the discussion centred on extractive activities, the equity method and the timing of the IFRS 10, 11 and 12 PIR. It is possible that the Board will undertake a review of IFRS 11 separately, and ahead of, IFRS 10.
Insurance
The staff summarised the first Insurance Contracts TRG meeting held on 6 February 2018 and gave an update on the educational activities for investors and analysts conducted from mid-May 2017 to the end of January 2018 on IFRS 17.
Analysis of due process documents
This Staff set out for the Board the different purposes of Discussion Papers (DP) and Exposure Drafts (ED). This Board will soon need to decide whether it should publish a DP or an ED for the projects on primary financial statements, goodwill and impairment as well as rate-regulated activities. It was suggested that the DPs should be more fully developed, with preliminary views, so that the gap between a DP and ED was not as big as it has been.
Rate-regulated activities
The Board decided that the unit of account for the model being developed be specified as the individual timing differences (as opposed to the net of all timing differences) arising from the regulatory agreement. The Board also concluded that rate-regulated rights and obligations will meet the definitions of assets and a liabilities in the revised Conceptual Framework.
Please click to access the detailed notes taken by Deloitte observers for the entire meeting.