Our summary now includes over 170 issues:

• IFRS 3: Measurement of non-controlling interest
• IFRS 3: Unreplaced and voluntarily replaced share-based payment awards
• IFRS 5: Write-down of a disposal group
• IAS 23: Meaning of 'general borrowings'

 

This allows for a comparison of similar entities in the public and private sector.

Private sector businesses in Canada will also be required to use IFRSs starting on the same date. Click for Press Release (PDF 103k).

The revised IAS 24 also clarifies that disclosure is required of any commitments of a related party to do something if a particular event occurs or does not occur in the future, including executory contracts (recognised and unrecognised). The revised standard is effective for annual periods beginning on or after 1 January 2011, with earlier application permitted.

Click to view IAS Plus Update IASB Issues Amendments to IAS 24 (PDF 68k). Links to all past IAS Plus Update newsletters are Here.

 

The IASB issued IFRS 9 on 12 November 2009 as the first step in its project to replace IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 introduces new requirements for classifying and measuring financial assets. Those requirements must be applied starting 1 January 2013, with earlier adoption permitted including for 2009. The IASB intends to expand IFRS 9 during 2010 to add new requirements for classifying and measuring financial liabilities, derecognition of financial instruments, impairment, and hedge accounting. By the end of 2010, IFRS 9 will be a complete replacement for IAS 39 – mandatory for 2013 and optional in earlier years. This newsletter explains the requirements of IFRS 9 in detail, compares IFRS 9 and IAS 39, and analyses the potential impact of a move to the new standard.

The headlines (from the IAS Plus Update Newsletter)

New classification and measurement requirements for financial assets New criteria for amortised cost measurement New measurement category – fair value through other comprehensive income Impairment assessment only for amortised cost assets     No more available-for-sale assets No more held-to-maturity assets and tainting rules No more embedded derivatives in financial assets No more unquoted equity investments measured at cost less impairment

 

• IAS 1 Presentation of Financial Statements (revised 2007)
• IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors
• IAS 32/39 Financial Instruments - Part 1
• IAS 32/39 Financial Instruments - Part 3

The following modules had previously been translated and posted:

• Introduction to IFRS e-Learning
• Conceptual Framework
• IAS 2 Inventories
• IAS 10 Events After the Reporting Period
• IAS 11 Construction Contracts
• IAS 16 Property, Plant and Equipment
• IAS 24 Related Party Disclosures
• IAS 38 Intangible Assets
• IAS 41 Agriculture
• IFRS 3 Business Combinations
• IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
• IFRS 8 Operating Segments

To download the modules (there is no charge, but registration is required) click on the lightbulb icon on the CAS Plus home page or Click Here.

 

The ED was issued on 23 July 2009. The objective of the proposals in the ED is to establish whether and how assets and liabilities resulting from rate-regulated activities should be recognised and measured under International Financial Reporting Standards (IFRSs). If adopted, the proposed IFRS would:

• define regulatory assets and regulatory liabilities.
• set out criteria for their recognition.
• specify how they should be measured.
• require disclosures about their financial effects.

The IASB was asked for guidance on the issue from many jurisdictions. Clarifying the accounting for rate regulation is of particular importance for jurisdictions that are in the process of adopting IFRSs and where accounting for the effect of rate regulation is in place for some sectors. In those cases entities are currently recognising sometimes significant 'regulatory' assets and liabilities by reference to an existing US standard, in the absence of an IFRS. Click for IASB Press Release (PDF 107k). Here is the link to the IAS Plus Project Page.

 

Click to Download the Commission's Letter (PDF 139k). Here is an excerpt:

Overall, we take note of a number of changes addressing issues raised in our letter of 15 September. However, it would seem that the current draft may not yet have struck the right balance between 'fair value accounting' and 'amortised cost accounting', and may lead to more instruments being classified at fair value through profit or loss compared to the existing IAS 39, thus potentially exacerbating income volatility – even if the impact will vary from one entity to another, depending on their business model and the type of financial instruments in their balance sheet. Concerns therefore remain about the way in which the IASB has defined the classification criteria set out in the draft.

Click for EFRAG Endorsement Status Report of 13 November 2009 (PDF 120k).

EFRAG consulted both on its assessment of IFRS 9 against the EU endorsement criteria and on its initial assessment of the costs and benefits that would arise from the implementation of IFRS 9 in the EU. Comments were requested by 13 November 2009. In that Draft Endorsement Advice, EFRAG's overall tentative conclusion was that the information provided by IFRS 9 would be relevant, reliable, understandable, and comparable. "IFRS 9 satisfies the criteria for EU endorsement and EFRAG should therefore recommend its endorsement". However, EFRAG has now decided that "more time should be taken to consider the output from the IASB project to improve accounting for financial instruments. Therefore, at this stage, EFRAG has decided not to finalise its endorsement advice on IFRS 9. EFRAG is currently considering how it will proceed in its work to address the package of standards that are expected to replace IAS 39." Most likely, EFRAG's deferral means that IFRS 9 will not be available for use in Europe for 2009 year-ends.

 

FASB tentatively decided to defer indefinitely the effective date of Statement 167 Amendments to FASB Interpretation No. 46(R) Consolidation of Variable Interest Entities for reporting of investments in the financial statements of asset managers. The FASB staff indicated that mutual funds, hedge funds, private equity funds, money market funds, and venture capital funds are examples of entities that may meet the conditions for deferral. The FASB staff also indicated that securitisation entities, asset-backed financing entities, or entities formerly classified as qualifying special-purpose entities (QSPEs) would not meet the conditions. If finalised, the deferral would be effective for 2009.

Click to view Heads Up Board Votes to Defer Statement 167 for Interests in Certain Entities (PDF 89k).