Two new organisations will now participate as will one new representative of an organisation that has already been participating. Four members of participating organisations have been reappointed.

For more information, please see the press release on the IFRS Foundation website.

The following topic was discussed:

ISSB consultation on agenda priorities: The ISSB discussed the strategic direction of its activities. The ISSB decided to begin new research and standard-setting projects; support the implementation of IFRS S1 and IFRS S2; enhance the SASB standards; pursue connectivity between the requirements in sustainability and financial reporting standards; seek to ensure that the ISSB standards are interoperable with other sustainability standards; and engage with stakeholders. The ISSB also decided to place a high level of focus on supporting the implementation of IFRS S1 and IFRS S2; to place a slightly lower level of focus on enhancing the SASB standards and on beginning new research and standard-setting projects and to give these activities equal attention; to reserve resources to give the ISSB flexibility; and not to specify a level of focus on connectivity, interoperability and engaging with stakeholders, acknowledging that these activities are integral to all of the ISSB’s work.

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

The agenda for the DPOC meeting is sum­marised below.

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

While Pillar 3 disclosures are meant to provide information about banking institutions’ risk management practices and regulatory capital ratios, UK Finance believes that the the Basel Committee on Banking Supervision (BCBS) can use its weight to back the ISSB’s IFRS standards and promote their adoption globally. The comment letter notes:

We recommend that BCBS encourage IFRS S2 adoption by banks in those regions that do not implement them. We recommend that the BCBS do all that is necessary to ensure that the global baseline framework of IFRS S2 requirements become and continue to inform jurisdictional climate risk disclosure requirements, driving consistency, comparability and thereby support broader sustainability disclosure objectives.

Please click to access the full comment letter on the UK Finance website. The recommendations around IFRS S2 Climate-related Disclosures inform the five key recommendations in the cover note.

The podcast discusses the following:

• the ISSB’s work with jurisdictions around the world;
• the recent SEC ruling;
• key takeaways from the SSAF meeting, the ISSB meeting and the TIG meeting;
• the ISSB's strategic direction and balance of activities for the next two-year work plan;
• the IFRS Sustainability Disclosure Taxonomy; and
• further ISSB activities in March.

For more information and access to the podcast, please see the press release on the IFRS Foundation website.

The following topics are on the agenda:

Board work plan update: The staff will provide an overview of the work plan. In particular, the staff will present completed projects, new projects, expected consultation documents and expected project completions.

Post-implementation review (PIR) of IFRS 9—Impairment: The IASB will deliberate the feedback received in response to its request for information Post-implementation Review—IFRS 9 Financial Instruments—Impairment. The staff recommends that the IASB does not take any further action on the matters raised by respondents regarding the use of forward-looking scenarios and post-model adjustments or management overlays in measuring expected credit losses.

Power purchase agreements: The staff will provide recommendations for amendments to propose in an exposure draft and ask for permission to begin the balloting process. In particular, the staff recommends proposed amendments to the own-use requirements and to the hedge accounting requirements. The staff also recommends that the IASB propose a scope for the amendments, and disclosure and transition requirements.

Second comprehensive review of the IFRS for SMEs Standard: The IASB will continue the redeliberations of its proposals in the exposure draft (ED) Third edition of the IFRS for SMEs Accounting Standard. In particular, the IASB will discuss the proposed revised Section 23 Revenue from Contracts with Customers, additional and alternative simplifications, other issues raised by respondents to the ED, proposed revised Section 2 Concepts and Pervasive Principles and updating the paragraph numbers of the IFRS for SMEs standard.

Climate-related and other uncertainties in the financial statements: The staff will explain the approach it has taken to develop examples illustrating how to apply requirements in IFRS Accounting Standards to report the effects of climate-related and other uncertainties in financial statements.

Maintenance and consistent application: The IASB will discuss whether and to what extent the proposed disclosures requirements in the forthcoming exposure draft (ED) Use of a Hyperinflationary Presentation Currency by a Non-hyperinflationary Entity should apply to subsidiaries without public accountability. The staff will also ask for permission to ballot the ED.

PIR of IFRS 15 Revenue from Contracts with Customers: In this session, the IASB will further analyse the feedback specific to determining the transaction price, determining when to recognise revenue and disclosure requirements of IFRS 15. The staff recommends that the IASB take no further action on those items.

Equity method: The staff will ask the IASB to clarify its tentative decision regarding transitional requirements for the proposed amendments to IAS 28 and to agree on the due process steps for the exposure draft.

Management commentary: The IASB will be asked for comments and questions on the discussion about the direction of the management commentary project. The staff has identified the following four broad alternative directions that the IASB could take at a future meeting: finalise the project; retire the project; undertake a broader project; and keep the project on hold.

Catch-up exposure draft of the forthcoming IFRS 19 Subsidiaries without Public Accountability: Disclosures: The staff will ask the IASB to agree on disclosure requirements to propose in the “catch-up exposure draft” following the publication of IFRS 19.

Rate-regulated activities: The IASB will continue to redeliberate the proposals in the exposure draft Regulatory Assets and Regulatory Liabilities, in particular the discount rate and reduced disclosure requirements.

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

The inclusion of feedback in the summaries does not indicate that a recommendation will be implemented or reflected in updates to either the Scope 3 Standard or Scope 3 Technical Guidance. Instead, the GHG Protocol secretariat and governance bodies are prioritising which topics to address in the update process, including the scope of work for updates and additional guidance and resources.

According to the draft summary report, the aim of any updates will be to align with best practice approaches to ensure that the GHG Protocol standards for corporate accounting and reporting are effective in providing a rigorous and credible accounting foundation for businesses to measure, plan, and track progress toward science-based and net-zero targets in line with the global 1.5°C goal. Any future updates will seek harmonisation and interoperability with accounting rules under development through major disclosure initiatives.

The review period for the summaries is open until 15 April 2024.  

Please click to access the following on the GHG Protocol website:

• Detailed Summary of Scope 3 Stakeholder Survey Responses
• Summary of Scope 3 Proposals

The package comprises three consultation papers:

• Proposed Criteria for Modification Framework
• Proposed CSDS 1 General Requirements for Disclosure of Sustainability-related Financial Information
• Proposed CSDS 2 Climate-related Disclosures

The proposed Criteria for Modification Framework presents the basis on which the CSSB could introduce changes to the ISSB standards. These criteria ensure that Canadian standards align with international standards while addressing Canadian public interest.

The proposed CSDS 1 and CSDS 2 are based on IFRS S1 and IFRS S2 with the following modifications: 

• The proposed effective dates for CSDS 1 and CSDS 2 have been extended by one year compared to that of IFRS S1 and IFRS S2 (i.e. the proposed standards would become voluntarily effective for annual reporting periods beginning on or after 1 January 2025);
• The proposed transition relief for disclosures beyond climate-related risks and opportunities has been extended from one year to two years;
• The proposed requirements to disclose comparative information have been changed to align with the proposed modification for the transition relief; and
• The proposed transition relief for disclosure of Scope 3 GHG emissions has been extended from one year to two years.

Please click to access the following on the Financial Reporting and Assurance Standards (FRAS) Canada website:

• Press release
• Proposed Criteria for Modification Framework
• Proposed CSDS 1
• Proposed CSDS 2
• In Brief — A plain and simple overview of the recently issued Exposure Drafts

Note: On 10 April 2024, the CSSB offers a webinar on the proposed new standards. Please click for more information here.

Background

This project results from the post-implementation review of IFRS 3 Business Combinations.

The feedback on the post-implementation review had revealed that impairment of goodwill is not always recognised in a timely fashion and that disclosures required by IFRSs do not provide enough information to understand whether the acquired business is performing as was expected at the time of the acquisition. There were also comments that the impairment test required for goodwill under IAS 36 Impairment of Assets is costly and complex.

The IASB therefore decided to investigate possible improvements to IFRS 3 Business Combinations and IAS 36 and a discussion paper was published on 19 March 2020.

The exposure draft published today considers feedback received on the discussion paper and proposes amendments to IFRS 3 and IAS 36 that aim at providing users with information that would allow them to better assess the performance of an entity’s business combinations and how efficiently and effectively management has used the entity’s economic resources to acquire these businesses.

Suggested changes

The proposed amendments in exposure draft IASB/ED/2024/1 Business Combinations — Disclosures, Goodwill and Impairment (Proposed amendments to IFRS 3 and IAS 36) are:

Proposed amendments to IFRS 3

• For strategic business combinations, which are a subset of material business combinations and are identified using a set of thresholds in IFRS 3, an entity would be required to provide information about its acquisition-date key objectives and related targets for the business combination and whether these key objectives and related targets are being met. An entity would only have to disclose information that is reviewed by its key management personnel.
• Entities would be exempted from disclosing some of the information if that information is commercially sensitive or would expose the entity to litigation risk.
• The exposure draft includes several other proposed amendments to the disclosure requirements in IFRS 3, including new disclosure objectives and disclosure requirements around expected synergies the strategic rationale for the business combination.

Proposed amendments to IAS 36

• The IASB proposes amendments to the impairment test in IAS 36 to reduce shielding by clarifying how to allocate goodwill to cash-generating units.
• Other proposed amendments regard the disclosure in which reportable segment a (group of) cash-generating unit is included and how an entity calculates an asset’s value in use. 

Other proposed amendments

• The exposure draft also proposes to amend the forthcoming IFRS 19 Subsidiaries without Public Accountability: Disclosures regarding disclosures about the strategic rationale for a business combination, the expected synergies, the contribution of the acquired business and the discount rate used in calculating the value in use.

Comments on the proposed changes are requested by 15 July 2024.

Effective date

The IASB will decide on the effective date for the proposed amendments after exposure. The IASB proposes to require an entity to apply the amendments prospectively. Earlier application would be permitted.

Additional information

Please click for:

• IASB press release
• Access to the exposure draft on the IFRS Foundation website
• Snapshot offering an overview of the proposals
• Short video explaining the proposals
• Our iGAAP in Focus newsletter explaining the proposed amendments
• Our IAS Plus project page on Goodwill and impairment

A summary of the agenda is set out below:

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