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IASB issues podcast on latest Board developments (November 2021)

29 Nov 2021

The IASB has released a podcast featuring IASB Chair Andreas Barckow and IASB Vice-Chair Sue Lloyd discussing deliberations at the November 2021 IASB meeting.

High­lights of the podcast include dis­cus­sions on: 

  • Updates and developments in primary financial state­ments and goodwill and impairment projects;
  • Refinements to the model proposed in the dynamic risk management project;
  • Feedback summary on the post-implementation review of IFRS 10, IFRS 11, and IFRS 12;
  • Feedback related to the consultation on rate-regulated activities;
  • Alignment of the IFRS for SMEs Standard with major standards;
  • Feedback in the IASB’s Third Agenda Consultation.

The podcast can be accessed through the press release on the IASB website.

Please click to view the detailed notes taken by Deloitte observers for the IASB meeting.

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Pre-meeting summaries for the November 2021 IFRS Interpretations Committee meeting

29 Nov 2021

The IFRS Interpretations Committee (Committee) meets on Tuesday 30 November and Wednesday 1 December 2021. The Committee will discuss the comment letter analyses for two tentative agenda decisions and two new submissions.

Comment letter analysis

IFRS 16 Leases—Economic Benefits from Use of a Windfarm: In June 2021, the Committee published a tentative agenda decision in response to a submission about the definition of a lease. The submitter asked whether, applying IFRS 16:B9(a), an electricity retailer (customer) has the right to obtain substantially all the economic benefits from use of a windfarm throughout the term of an agreement with a windfarm generator (supplier). The Committee concluded that the principles and requirements in IFRS Standards provide an adequate basis to account for this matter. Many of the respondents to the tentative agenda decision agreed with the conclusion. Nonetheless, some of them raised some further matters for the Committee to consider. The staff analysed these matters and recommend finalising the agenda decision with the addition of two references to previous agenda decisions to address issues raised by respondents.

IFRS 9 Financial Instruments and IAS 20 Accounting for Government Grants and Disclosure of Government Assistance—TLTRO III Transactions: In its June 2021 meeting, the Committee discussed a submission asking how banks account for the European Central Bank (ECB)’s Targeted Longer-Term Refinancing Operations (TLTRO). Specifically, the submission asked whether the TLTRO III tranches are loans at a below-market interest rate which should be accounted for as a government grant. The staff have analysed the comment letters and recommend finalising the agenda decision with minor editorial changes.

New submissions

IFRS 15 Revenue from Contracts with Customers—Principal versus Agent: Software Reseller: The Committee received a submission asking whether a reseller of software licences is a principal or agent in respect to the standard software licences provided to the customer. The staff found that the fact pattern is highly specific and even small or subtle differences in the specific facts and circumstances could change the conclusion when applying the requirements about principal versus agent considerations in IFRS 15. The staff were therefore of the view that it would be inappropriate for the Committee to conclude whether the reseller is a principal or agent in the fact pattern submitted. Instead, the staff recommend publishing a tentative agenda decision should that only sets out the applicable requirements in IFRS 15 and explains how a reseller might apply those requirements.

IAS 37 Provisions, Contingent Liabilities and Contingent Assets—Negative low or new energy vehicle credits: The Committee received a submission asking whether an entity with negative low emission vehicle credits has a present obligation that meets the definition of a liability in IAS 37. If the answer to this question is "no", the submitter asked whether the Committee’s views would be different if the entity had entered into a binding contract to purchase positive new energy credits before the end of the reporting period the entity, but that contract is settled after the end of the reporting period. The staff recommend that the Committee publish a tentative agenda decision that outlines whether an entity with negative low emission vehicle credits has a present obligation that meets the definition of a liability in IAS 37.

Work in progress: The following new matters have not yet been presented to the Committee:

  • Rent Concessions: Lessors and Lessees (IFRS 16 and IFRS 9)
  • Special Purpose Acquisition Companies (SPAC): Classification of Public Shares as Liabilities or Equity (IAS 32)

The full agenda for the meeting and our com­pre­hen­sive pre-meet­ing summaries can be found here.

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IFRS Foundation appoints two new Trustees

29 Nov 2021

The IFRS Foundation has announced the appointment of Jorge Familiar and Keiko Tashiro as Trustees of the IFRS Foundation. Their appointments will begin on 1 January 2022 and will expire on 31 December 2024.

Jorge Familiar is Vice-President for Finance and Group Controller for the World Bank and has recently been appointed Vice-President and Treasurer effective from 1 January 2022.

Keiko Tashiro is Deputy President at Daiwa Securities and also serves as the group’s Head of Overseas Operations and Head of Sustainable Development Goals.

In addition, the current IFRS Foundation Trustee Chair Erkki Liikanen and Trustees Sarah J Al Suhaimi and Dr Suresh P Kana have been reappointed to serve a second three-year term, also beginning on 1 January 2022.

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

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COVID-19 disclosure quality in European banks' financial statements

29 Nov 2021

A study published as part of the working paper series of the European Banking Institute (EBI) looks at COVID-19 disclosures in half-year and year-end financial statements 2020 of European banks.

ESMA, EBA, IOSCO and IASB communicated in the second quarter of 2020 their expectations on disclosure regarding the pandemic’s impact in order to meet the objective of the IFRS to provide decision-useful information to stakeholders. The aim of the study was to examine the extent to which banks fulfilled the disclosure expectations communicated by the relevant professional institutions.

The papers of the EBI working paper series are available on SSRN. Please click to access the COVID-19 study here.

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IASB proposes amendments to IAS 7 and IFRS 7 regarding supplier finance arrangements

26 Nov 2021

The International Accounting Standards Board (IASB) has published the exposure draft 'Supplier Finance Arrangements (Proposed amendments to IAS 7 and IFRS 7)' to add disclosure requirements, and ‘signposts’ within existing disclosure requirements, that would ask entities to provide qualitative and quantitative information about supplier finance arrangements. The deadline for submitting comments is 28 March 2022.



The IFRS Interpretations Committee received a submission about supply chain finance arrangements asking:

  • How an entity presents liabilities to pay for goods or services received when the related invoices are part of a supply chain finance (or reverse factoring) arrangement; and
  • what information about reverse factoring arrangements an entity is required to disclose in its financial statements.

In response to that submission, the Committee published an agenda decision in December 2020. However, feedback and input received — in particular from investors and analysts — suggested the information entities provide about supplier finance arrangements applying existing IFRS requirements does not meet all investor information needs.

In response to that feedback, the Board tentatively decided to amend IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures to add disclosure requirements, and ‘signposts’ within existing disclosure requirements, that would ask entities to provide qualitative and quantitative information about supplier finance arrangements.


Key proposals

The main proposals in ED/2021/10 Supplier Finance Arrangements (Proposed amendments to IAS 7 and IFRS 7) would: 

  • Not define supplier finance arrangements. Instead, the proposed amendments describe the characteristics of an arrangement for which an entity would be required to provide the proposed information and the amendments would also provide examples of the different forms of such arrangements that would be within the scope of the Board’s proposals.
  • Add a disclosure objective. Entities would have to disclose in the notes information that enables users of financial statements to assess the effects of their supplier finance arrangements on their liabilities and cash flows.
  • Complement current requirements in IFRSs by adding additional disclosure requirements about:
    • the terms and conditions of each supplier finance arrangement;
    • for each arrangement, as at the beginning and end of the reporting period:
      • a) the carrying amount of financial liabilities that are part of the arrangement and the line item(s) in which those financial liabilities are presented;
      • b) the carrying amount of financial liabilities disclosed under a) for which suppliers have already received payment from the finance providers;
      • c) the range of payment due dates (for example, 30 to 40 days after the invoice date) of financial liabilities disclosed under a); and
    • as at the beginning and end of the reporting period, the range of payment due dates of trade payables that are not part of a supplier finance arrangement.
    An entity would only be permitted to aggregate this information for different arrangements when the terms and conditions of the arrangements are similar.
  • Add supplier finance arrangements as an example within the liquidity risk disclosure requirements in IFRS 7 and the disclosure requirements regarding changes in liabilities arising from financing activities in IAS 7.

The deadline for submitting comments on these proposals is 28 March 2022.


Effective date

The Board intends to decide on the effective date after exposure. The amendments would be applied retrospectively in accordance with IAS 8. Earlier application would be permitted.


Additional information

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


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ICAEW concludes series on IPSAS vs IFRS

26 Nov 2021

Over the recent months, the Institute of Chartered Accountants in England and Wales (ICAEW) published a series of reviews of major standards looking at the differences between International Financial Reporting Standards (IFRS) and International Public Sector Accounting Standards (IPSASB), and the suitability of each in public sector financial reporting. The fourth and final part of the series has now been released.

When introducing the series, ICAEW noted that IFRS are internationally recognised and widely adopted which brings about consistency in financial statements which in turn facilitates cross border comparability and understandability. On the other hand, IPSAS are designed for public sector entities whose main objectives are to provide goods and services to benefit society and to redistribute wealth. Therefore, the ICAEW series looked into the question what is the better choice of standards if a government were to adopt accrual accounting now.

The complete series of in-depth reviews can now be accessed on the ICAEW website:

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Joint webinar on the IASB exposure draft on disclosure requirements

26 Nov 2021

EFRAG, BusinessEurope, and the IASB will host a joint webinar on 10 December 2021 on the IASB’s exposure draft 'Disclosure Requirements in IFRS Standards—A Pilot Approach (Proposed amendments to IFRS 13 and IAS 19)'.

The joint webinar will inform constituents about the IASB/EFRAG field test results as speakers and panellists will discuss the application of the IASB proposals and their experience during the field test. Audit implications will also be discussed along with a first reaction from the users. Interested preparers that could not participate in the field test will also have the opportunity to provide their input.

For more information and registration, please see the press release on the EFRAG website.

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EBA report on IFRS 9 implementation

25 Nov 2021

The European Banking Authority (EBA) has published a report summarising the findings arising from the monitoring activities on the IFRS 9 implementation by EU institutions. EBA notes significant efforts in IFRS 9 implementation by EU institutions, but cautions on some of the observed accounting practices, especially in the context of the COVID-19 pandemic.

The report observes that EU institutions have made significant efforts to implement and adapt their systems to the IFRS 9 requirements since its first application date. However, the level of judgement embedded in the standard leaves open the possibility to use a wide variety of practices. In addition, the COVID-19 pandemic added to divergence. The report concludes:

  • Divergence in some accounting practices is due to the inherent flexibility embedded in IFRS 9 and the limited experience to date.
  • The COVID-19 pandemic pushed IFRS 9 models outside their boundaries, thereby increasing the use of manual adjustments, or overlays, with divergent results on the final expected credit loss amount.
  • Some practices observed, particularly in the context of COVID-19, would deserve further scrutiny from supervisors in particular to ensure a timely assessment of a significant increase in credit risk.

Please click to access the full report through the press release on the EBA website.

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We comment on the IASB's management commentary proposal

24 Nov 2021

Deloitte has commented on the exposure draft 'Management Commentary' published by the IASB in May 2021.

We welcome the Board’s project to revise the Practice Statement on Management Commentary. However, we believe that further improvements are necessary on the following issues:

  • The Practice Statement would benefit from clearer concepts to help preparers and users understand its underlying thinking and to set a context for the type and range of disclosures envisaged.
  • We do not think that it is sufficient to measure financial outcomes alone as appears to be proposed in the Exposure Draft.
  • We suggest restructuring the Practice Statement to make it easier to navigate and apply, for example, by reducing the number of elements. In our view, these elements overlap in many aspects and their interaction and purpose is not always immediately understandable. We suggest a closer alignment to the <IR> Framework, whose structure includes fundamental concepts, guiding principles for the preparation and presentation of an integrated report, content elements that are fundamentally linked to each other, and high-level and specific objectives for each content element.
  • We suggest that the approach to materiality set out in the Practice Statement should articulate more clearly that it necessitates the application of a filter to identify a subset of impacts that are relevant to enterprise value and are therefore material to the information needs of users of management commentary.

In addition, since this project commenced, the IFRSF has made a significant move towards establishing global sustainability standards. We think the Board should therefore consider the future direction of the project in the light of this development.

Please click to download our full comment letter here.

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Agenda for the December 2021 ASAF meeting

23 Nov 2021

The International Accounting Standards Board (IASB) has released an agenda and meeting papers for the meeting of the Accounting Standards Advisory Forum (ASAF), which is to be held by remote participation on 9-10 December 2021. A summary of the agenda is set out below:

Thursday 9 December 2021 (11:00-14:45)

  • Intangibles — ASAF members will share preliminary feedback on EFRAG’s Discussion Paper Better Information on Intangibles.
  • Strategic / agenda consultations — ASAF members will discuss any recent strategic / agenda consultations in their jurisdictions and discuss how it compares to the feedback on the IASB’s Third Agenda Consultation.
  • Agenda planning and feedback from the previous ASAF meeting — ASAF members will provide views on topics for future meetings and any comments on how the feedback from the October 2021 ASAF meeting has been (or will be) used by the staff or the Board.

Friday 10 December 2021 (11:00-14:45)

  • Goodwill and impairment — ASAF members’ views on staff examples illustrating the information the staff expect an entity to disclose applying the Board’s preliminary views expressed in the Discussion Paper Business Combinations — Disclosures, Goodwill and Impairment.
  • Disclosure initiative — Subsidiaries without public accountability: Disclosures — ASAF members’ views on the scope of the draft Standard.
  • Disclosure Initiative — Targeted Standards-level review of disclosures — ASAF members will have the opportunity to share feedback from their jurisdictions on the Exposure Draft Disclosure Requirements in IFRS Standards—A Pilot Approach.

Agenda papers for the meeting are available on the IASB website.

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