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IFRS Foundation Coronavirus update

12 Mar 2020

The IFRS Foundation has provided updated operational information related to the Coronavirus. The inforation regards the March CMAC meeting, the March IASB meeting, and general information about visits to the IFRS Foundation offices.

The March CMAC meeting (26 March 2020) will be remote access only for observers. CMAC members will only attend if they are based in London and meet the criteria for visits to the IFRS Foundation offices.

The March IASB meeting (17 and 19 March 2020) is currently expected to proceed as planned, however, observers are reminded that digital access is available. Should the IFRS Foundation offices need to be closed, the meeting will be held by video conference and will feature a reduced agenda.

All visitors to the IFRS Foundation offices will need to confirm before arrival that they haven't been to a category 1 or 2 hotspot in the past 14 days and have not experienced any flu-like symptoms in the past seven days.

Please click for the full update on the IASB website.

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Pre-meeting summaries for the March 2020 IASB meeting

11 Mar 2020

The IASB will meet in London on 17 and 19 March 2020. We have posted our pre-meeting summaries for the meeting that allow you to follow the IASB’s decision making more closely. For each topic to be discussed, we summarise the agenda papers made available by the IASB staff and point out the main issues to be discussed by the IASB and the staff recommendations.

Maintenance and Consistent Application: In 2017, the IFRS Interpretations Committee received a question about a particular commodity loan transaction and observed that the transaction may not be captured within the scope of any IFRS Standard. The staff recommend that the Board consider referring to commodity transactions as a potential project in its Request for Information (RFI) on the 2020 Agenda Consultation.

Agenda Consultation: The staff set out the plan for the 2020. They expect to publish the RFI in September, with a comment deadline of January 2021. After the Board has considered the feedback the work plan and feedback statement are expected to be published in Q4 2021.

Disclosure Initiative—Subsidiaries that are SMEs: In the January 2020 meeting, the Board agreed to move the project from the research programme to the standard-setting programme. The objective is to develop a reduced disclosure IFRS Standard that would apply on a voluntary basis to subsidiaries that are SMEs, adapted from the disclosure requirements of the IFRS for SMEs Standard. The staff expect to start drafting an ED or a DP in Q4 2020.

Rate-regulated Activities: The staff have been drafting the ED for the accounting model for regulatory assets and regulatory liabilities since last July. The staff are asking the Board to clarify whether some components included in the regulated rates in a period form part of total allowed compensation for the goods or services supplied by an entity in the same period or in a different period. In particular, the staff are seeking clarification about whether regulatory returns and performance incentives included in the regulated rates for a period form part of the total allowed compensation for to the goods or services supplied in the same period.

Management Commentary: The Board will continue its discussions about the objective of management commentary, which the staff recommend should be to support primary users in assessing an entity’s prospects of future cash flows and assessing management’s stewardship of the entity’s economic resources. The primary users are existing and potential investors, lenders and other creditors and they are expected to have a reasonable knowledge of business and economic activities. The staff will also introduce their thinking on developing disclosure objectives for various types of content to be included in management commentary.

Disclosure Initiative—Targeted Standards-level Review of Disclosures: The staff will ask permission to begin the balloting process on Exposure Draft (ED) Targeted Standards-level Review of Disclosures—Amendments to IAS 19 and IFRS 13. The staff recommend a comment period of 180 days.

Financial Instruments with Characteristics of Equity: At the December 2019 Board meeting, the Board discussed the staff’s preliminary analysis on how the fixed-for-fixed requirement in IAS 32 could be clarified. At this meeting the staff recommend that the Board articulate its foundation principle by stating that in a derivative on own equity that meets the fixed-for-fixed condition, the amount of functional currency units to be exchanged with each underlying equity instrument is fixed and does not vary other than (if applicable) with preservation adjustments and passage of time adjustments. The staff also set out recommendations for how the preservation and passage of time adjustments should be expressed. The staff will also present their plan for outreach with stakeholders on potential disclosures that can be developed as part of the FICE project.

Post-implementation review of IFRS 10, 11 and 12: The staff recommend that the Board proceed with the PIR and publish an RFI to gather more information about the application of these Standards.

Amendments to IFRS 17 Insurance Contracts: The staff recommend that the Board defer the effective date of IFRS 17 (incorporating the amendments) to annual reporting periods beginning on or after 1 January 2023 and extend the fixed expiry date of the temporary exemption from applying IFRS 9 in IFRS 4 to the same date. The staff expect that the amendments will be issued in the second quarter of 2020.

More information

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

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Applicants invited for IFRS Interpretations Committee membership

09 Mar 2020

The Trustees of the IFRS Foundation have invited applications for candidates to fill four vacancies on the IFRS Interpretations Committee.

Specif­i­cally, the Trustees are seeking in­di­vid­u­als who have a preparer focus. Members are expected to attend ap­prox­i­mately six two-day meetings each year held in London. Terms of mem­ber­ship will begin 1 July 2020 and will expire on 30 June 2023. Mem­ber­ship is unpaid, but the IFRS Foun­da­tion meets members' expenses of travel on IFRS IC business.

Ap­pli­ca­tions are accepted until 9 April 2020.

For more in­for­ma­tion, see the press release on the IASB’s website.

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IFRS Interpretations Committee holds March 2020 meeting

09 Mar 2020

The IFRS Interpretations Committee met on 3 March 2020. We have posted Deloitte observer notes for the technical issues discussed during this meeting.

Item for Continuing Discussion

IFRS 16 Leases—Sale and leaseback with variable payments (Agenda Paper 2): The Committed concluded that the accounting of a sale and leaseback transaction at the date of transaction is clear. However, it recommended standard-setting to clarify the subsequent measurement of the seller-lessee's liability arising from such sale and leaseback with variable payments.

New Issue

IAS 12 Income Taxes—Deferred tax related to a subsidiary's undistributed profits (Agenda Paper 3): The Committee concluded that a reporting entity should recognise deferred tax for the temporary differences arising from undistributed profits of a subsidiary and will publish a tentative agenda decision with amendments suggested in the meeting and explaining why neither an interpretation of, nor an amendment to, IAS 12 is necessary.

Agenda Decisions to Finalise

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): The Committee decided, unanimously, to finalise the agenda decision with amendments to wording.

IFRS 15 Revenue from Contracts with Customers—Training costs to fulfil a contract (Agenda Paper 5): The Committee decided, by a majority vote, to finalise all three agenda decisions, with some amended wording.

More information

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

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IASB to complete its planned redeliberations of the proposed IFRS 17 amendments

06 Mar 2020

At its upcoming March meeting, the IASB will discuss the remaining issues resulting from the feedback received on the exposure draft ED/2019/4 'Amendments to IFRS 17' which are the effective date of IFRS 17 and the expiry date of the IFRS 9 temporary exemption in IFRS 4.

On the effective date, which originally was set at 1 January 2021 and which ED/2019/4 proposed to move to 1 January 2022, the staff now recommend that the Board:

  • a) defer the effective date of IFRS 17 (incorporating the amendments) to annual reporting periods beginning on or after 1 January 2023; and
  • b) extend the fixed expiry date of the temporary exemption from applying IFRS 9 in IFRS 4 to annual reporting periods beginning on or after 1 January 2023.

The staff recommend that the amendment to IFRS 4 — reflecting the extension of the fixed expiry date for the temporary exemption from applying IFRS 9 — is balloted separately from the amendments to IFRS 17 (including consequential amendments to other IFRSs). This will give jurisdictions with an endorsement process the possibility to endorse the temporary exemption independently (and possibly more quickly) and so avoid endorsement after the current temporary exemption has run out (January 2021).

The papers for the meeting also offer an overview of all topics discussed and the Board's tentative decisions (links are to our Deloitte meeting notes taken at the meeting the decision was made).

Topic Confirm amendment as proposed in the ED Confirm proposed amendment with some changes Amendment not proposed in the ED
1A — Scope exclusion for credit cards January 2020
1B — Scope exclusion for loans December 2019
2 — Expected recovery of insurance acquisition cash flows December 2019, January 2020
3 — Contractual service margin attributable to investment services December 2019, February 2020
4 — Reinsurance contracts held — recovery of losses December 2019
5 — Presentation in the statement of financial position December 2019
6A — Applicability of the risk mitigation option — reinsurance contracts held December 2019
6B — Applicability of the risk mitigation option — non-derivative financial instruments at fair value through profit or loss February 2020
7 — Accounting policy choice relating to interim financial statements January 2020
8A — Effective date of IFRS 17 To be decided at March 2020 meeting
8B — Expiry date of IFRS 9 temporary exemption in IFRS 4 To be decided at March 2020 meeting
9A — Transition relief for contracts acquired December 2019
9B — Transition reliefs for the risk mitigation option — the application from the transition date December 2019
9C — Transition relief for risk mitigation option — the option to apply the fair value approach December 2019
9D — Transition relief for investment contracts with discretionary participation features February 2020
9E — Transition relief for identifying the date a reinsurance contract held was acquired February 2020
9F — Transition relief relating to interim financial statements February 2020
10 — Minor amendments February 2020

After its March 2020 meeting, the Board will have completed its planned redeliberations of the feedback on the exposure draft. If the Board gives permission to start the balloting process at this meeting, the staff plan to draft the amendments to IFRS 17 and bring any sweep issues identified during the balloting of the amendments for discussion at a future meeting. The staff expect that the amendments will be issued in the second quarter of 2020, in line with the Board’s plan as stated in the exposure draft.

Please click to access all papers for the meeting on the IASB website. The discussion of the IFRS 17 amendments is currently scheduled for Tuesday 17 March 14.30-15.30 London time.

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March 2020 IASB meeting agenda posted

06 Mar 2020

The IASB has posted the agenda for its next meeting, which will be held at its offices in London on 17 and 19 March 2020. There are nine topics on the agenda.

The Board will discuss the following:

  • Maintenance and consistent application
  • Agenda consultation
  • Amendments to IFRS 17 Insurance Contracts
  • Disclosure initiative — Subsidiaries that are SMEs
  • Rate-regulated activities
  • Management commentary
  • Disclosure initiative — Targeted Standards-level review of disclosures
  • Financial instruments with characteristics of equity
  • Post-implementation review of IFRS 10–12

The full agenda for the meeting can be found here. We will post any updates to the agenda, our com­pre­hen­sive pre-meet­ing summaries as well as observer notes from the meeting on this page as they become available.

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EFRAG to conduct field-testing on IASB’s project on primary financial statements

06 Mar 2020

The EFRAG, in coordination with European National Standard Setters and the IASB, will conduct field-testing on the IASB’s Exposure Draft ED/2019/7, ‘General Presentation and Disclosures’, and invites companies to participate in the field-testing.

The field-testing will help ‘identify potential implementation and application concerns, to determine whether there is a need for additional guidance, and to estimate the effort required to implement and apply the proposals’. The deadline to participate in the field-testing is 3 April 2020.

For more information, see the press release on the EFRAG’s website.

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IFRS Foundation issues Coronavirus update

04 Mar 2020

The IFRS Foundation has provided an operational update related to the Coronavirus. At this time, the IFRS Foundation expects to continue its current plan of scheduled public meetings and events, except for the March IFRS Advisory Council meeting which has been postponed. In addition, the April ASAF meeting will only meet via remote digital participation.

Public meetings will continue to provide a remote digital option for those who cannot attend in person. Any changes to the schedule will be flagged on the IASB’s meeting calendar.

For more information, see the press release on the IASB’s website.

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IASB issues podcast on latest Board developments (February 2020)

03 Mar 2020

The IASB has released a podcast, featuring IASB Chair Hans Hoogervorst and Vice-Chair Sue Lloyd as well as Mark Byatt from the IFRS Foundation, to discuss the deliberations at the February IASB meeting.

The podcast features dis­cus­sions related to:

  • Disclosure initiative;
  • Business combinations under common control;
  • IBOR (phase 2);
  • Amendments to IFRS 17.

The podcast can be accessed through the press release on the IASB website. More in­for­ma­tion on the topics discussed is available through our com­pre­hen­sive notes taken by Deloitte observers at the February IASB meeting.

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IASB issues webcast related to its request for information on the IFRS for SMEs Standard

02 Mar 2020

The IASB has issued the first in a series of webcasts related to the ‘Request for Information: Comprehensive Review of the IFRS for SMEs Standard' issued on 28 January 2020.

This webcast provides an overview of the IFRS for SMEs Standard and introduces the Request for Information. A second webcast is expected later in March to discuss the approach of the second comprehensive review and a third webcast is expect in April to discuss questions to the project team related to the alignment of IFRS for SMEs Standards with IFRS Standards.

For more information, see the press release on the IASB’s website.

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