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New and revised pronouncements as at 30 September 2018

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21 Sep 2018

Our popular summary of new and revised financial reporting requirements, updated for financial reporting periods ending on 30 September 2018. This listing can be used to perform a quick check that new financial reporting requirements such as new and revised accounting standards and interpretations, and amendments to standards and interpretations, have been fully considered in the reporting close process. The information below can also be used to assist with the disclosure requirements under paragraph 30 of IAS 8 'Accounting Policies, Changes in Accounting Estimates and Errors', which requires entities to disclose any new IFRSs that are in issue but not yet effective and which are likely to impact the entity.

This table can be used for all annual accounting periods. A 1st quarter ending on 30 September 2018 would mean that the annual reporting period began on 1 July 2018. Similarly, 2nd quarters ending on 30 September 2018 refer to annual periods that began on 1 April 2018, 3rd quarters ending on 30 September 2018 refer to annual periods that began on 1 January 2018, and 4th quarters ending on 30 September 2018 refer to annual periods that began on 1 October 2017.

The information below reflects developments to 21 September 2018 and will be updated through to December 2018 to reflect new and revised financial reporting requirements that need to be considered for financial reporting periods ending on 30 September 2018. For accounts approved after September 2018, please also refer to subsequent versions of this document for any new and revised IFRSs that have additionally been issued that might require disclosure in the accounts under IAS 8:30.

The information below is organised as follows:

 

Summary

Pronouncements applicable to entities applying IFRSs at the IASB effective dates

The table below provides a summary of the pronouncements which will be mandatorily applied by entities for the first time at 30 September 2018, for various quarterly reporting periods:

Pronouncement Effective date* Mandatory at 30 September 2018?
1st qtrs 2nd qtrs 3rd qtrs Full yrs
STANDARDS
IFRS 9 Financial Instruments 1 January 2018 Yes Yes Yes -
IFRS 15 Revenue from Contracts with Customers
1 January 2018 Yes Yes Yes -
INTERPRETATIONS
IFRIC 22 Foreign Currency Transactions and Advance Consideration 1 January 2018 Yes Yes Yes -
AMENDMENTS
Recognition of Deferred Tax Assets for Unrealised Losses (Amendments to IAS 12)
1 January 2017 ** ** ** Yes
Disclosure Initiative (Amendments to IAS 7)
1 January 2017 ** ** ** Yes
Annual Improvements to IFRS Standards 2014–2016 Cycle – Amendments to IFRS 12
1 January 2017 ** ** ** Yes
Clarifications to IFRS 15 'Revenue from Contracts with Customers'
1 January 2018 Yes Yes Yes -
Classification and Measurement of Share-based Payment Transactions (Amendments to IFRS 2)
1 January 2018 Yes Yes Yes -
Applying IFRS 9 'Financial Instruments' with IFRS 4 'Insurance Contracts' (Amendments to IFRS 4)
1 January 2018 Optional° Optional° Optional° -
Transfers of Investment Property (Amendments to IAS 40)
1 January 2018 Yes Yes Yes -
Annual Improvements to IFRS Standards 2014–2016 Cycle (Amendments to IFRS 1 and IAS 28)
1 January 2018 Yes Yes Yes -

* Generally annual periods beginning on or after the date indicated, may only apply to first-time adopters in some limited cases (see the detailed information for each pronouncement below for full details).

** This pronouncement has already been implemented in previous periods by entities with this reporting date (where it applied to the entity).

° The application of both approaches (overlay approach/ deferral approach) is optional and an entity is permitted to stop applying them before the new insurance contracts standard is applied.

More information about these pronouncements, and all new and revised pronouncements, is set out below.

 

Financial statement considerations in adopting new and revised pronouncements

Where new and revised pronouncements are applied for the first time, there can be consequential impacts on annual financial statements, including:

  • Impact of transitional provisions. IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors contains a general requirement that changes in accounting policies are retrospectively applied, but this does not apply to the extent an individual pronouncement has specific transitional provisions.
  • Disclosures about changes in accounting policies. Where an entity changes its accounting policy as a result of the initial application of an IFRS and it has an effect on the current period or any prior period, IAS 8 requires the disclosure of a number of matters, e.g. the title of the IFRS, the nature of the change in accounting policy, a description of the transitional provisions, and the amount of the adjustment for each financial statement line item affected
  • Third statement of financial position. IAS 1 Presentation of Financial Statements requires the presentation of a third statement of financial position as at the beginning of the preceding period in addition to the minimum comparative financial statements in a number of situations, including if an entity applies an accounting policy retrospectively and the retrospective application has a material effect on the information in the statement of financial position at the beginning of the preceding period
  • Earnings per share (EPS). Where applicable to the entity, IAS 33 Earnings Per Share requires basic and diluted EPS to be adjusted for the impacts of adjustments result from changes in accounting policies accounted for retrospectively and IAS 8 requires the disclosure of the amount of any such adjustments.

Whilst disclosures associated with changes in accounting policies resulting from the initial application of new and revised pronouncements are less in interim financial reports under IAS 34 Interim Financial Reporting, some disclosures are required, e.g. description of the nature and effect of any change in accounting policies and methods of computation.

 

New or revised standards


IFRS 9 Financial Instruments

Finalised version of IFRS 9 which contains accounting requirements for financial instruments, replacing IAS 39 Financial Instruments: Recognition and Measurement. The standard contains requirements in the following areas:

  • Classification and measurement. Financial assets are classified by reference to the business model within which they are held and their contractual cash flow characteristics. The 2014 version of IFRS 9 introduces a 'fair value through other comprehensive income' category for certain debt instruments. Financial liabilities are classified in a similar manner to under IAS 39, however there are differences in the requirements applying to the measurement of an entity's own credit risk.
  • Impairment. The 2014 version of IFRS 9 introduces an 'expected credit loss' model for the measurement of the impairment of financial assets, so it is no longer necessary for a credit event to have occurred before a credit loss is recognised
  • Hedge accounting. Introduces a new hedge accounting model that is designed to be more closely aligned with how entities undertake risk management activities when hedging financial and non-financial risk exposures
  • Derecognition. The requirements for the derecognition of financial assets and liabilities are carried forward from IAS 39.

Note: Depending on the chosen approach to applying IFRS 9, the transition can involve one or more than one date of initial application for different requirements.

Note: IFRS 9 (2014) supersedes IFRS 9 (2009), IFRS 9 (2010) and IFRS 9 (2013)

Issued: 24 July 2014

Effective date:

Effective for annual periods beginning on or after 1 January 2018

First quarters ending 30 September 2018:

Mandatory

Second quarters ending 30 September 2018:

Mandatory

Third quarters ending 30 September 2018:

Mandatory

Annual periods ending 30 September 2018:

Optional


IFRS 15 Revenue from Contracts with Customers

IFRS 15 provides a single, principles based five-step model to be applied to all contracts with customers.

The five steps in the model are as follows:

  • Identify the contract with the customer
  • Identify the performance obligations in the contract
  • Determine the transaction price
  • Allocate the transaction price to the performance obligations in the contracts
  • Recognise revenue when (or as) the entity satisfies a performance obligation.

Guidance is provided on topics such as the point in which revenue is recognised, accounting for variable consideration, costs of fulfilling and obtaining a contract and various related matters. New disclosures about revenue are also introduced.

Issued: 28 May 2014

Effective date:

Applicable to an entity's first annual IFRS financial statements for a period beginning on or after 1 January 2018

First quarters ending 30 September 2018:

Mandatory

Second quarters ending 30 September 2018:

Mandatory

Third quarters ending 30 September 2018:

Mandatory

Annual periods ending 30 September 2018:

Optional


IFRS 16 Leases

IFRS 16 specifies how an IFRS reporter will recognise, measure, present and disclose leases. The standard provides a single lessee accounting model, requiring lessees to recognise assets and liabilities for all leases unless the lease term is 12 months or less or the underlying asset has a low value. Lessors continue to classify leases as operating or finance, with IFRS 16’s approach to lessor accounting substantially unchanged from its predecessor, IAS 17.

Issued: 13 January 2016

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2019

First quarters ending 30 September 2018:

Optional

Second quartersending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


IFRS 17 Insurance Contracts

IFRS 17 requires insurance liabilities to be measured at a current fulfillment value and provides a more uniform measurement and presentation approach for all insurance contracts. These requirements are designed to achieve the goal of a consistent, principle-based accounting for insurance contracts. IFRS 17 supersedes IFRS 4 Insurance Contracts as of 1 January 2021.

Issued: 18 May 2017

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2021

Not yet endorsed for use in the EU.

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


 

 

New or revised interpretations


IFRIC 22 Foreign Currency Transactions and Advance Consideration

The interpretation addresses foreign currency transactions or parts of transactions where:

  • there is consideration that is denominated or priced in a foreign currency;
  • the entity recognises a prepayment asset or a deferred income liability in respect of that consideration, in advance of the recognition of the related asset, expense or income; and
  • the prepayment asset or deferred income liability is non-monetary.

The Interpretations Committee came to the following conclusion:

  • The date of the transaction, for the purpose of determining the exchange rate, is the date of initial recognition of the non-monetary prepayment asset or deferred income liability.
  • If there are multiple payments or receipts in advance, a date of transaction is established for each payment or receipt.

Issued: 8 December 2016

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2018

First quarters ending 30 September 2018:

Mandatory

Second quarters ending 30 September 2018:

Mandatory

Third quarters ending 30 September 2018:

Mandatory

Annual periods ending 30 September 2018:

Optional


IFRIC 23 Uncertainty over Income Tax Treatments

The interpretation addresses the determination of taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates, when there is uncertainty over income tax treatments under IAS 12. It specifically considers:

  • Whether tax treatments should be considered collectively
  • Assumptions for taxation authorities' examinations
  • The determination of taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates
  • The effect of changes in facts and circumstances

Issued: 7 June 2017

Effective date:

Applicable to annual reporting periods beginning on or after 1 January 2019

Not yet endorsed for use in the EU.

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


 

 

Amendments


Recognition of Deferred Tax Assets for Unrealised Losses (Amendments to IAS 12)

Amends IAS 12 Income Taxes to clarify the following aspects:

  • Unrealised losses on debt instruments measured at fair value and measured at cost for tax purposes give rise to a deductible temporary difference regardless of whether the debt instrument's holder expects to recover the carrying amount of the debt instrument by sale or by use.
  • The carrying amount of an asset does not limit the estimation of probable future taxable profits.
  • Estimates for future taxable profits exclude tax deductions resulting from the reversal of deductible temporary differences.
  • An entity assesses a deferred tax asset in combination with other deferred tax assets. Where tax law restricts the utilisation of tax losses, an entity would assess a deferred tax asset in combination with other deferred tax assets of the same type.

Issued: 19 January 2016

Effective date:

Effective for annual periods beginning on or after 1 January 2017

First quarters ending 30 September 2018:

[Note 1]

Second quarters ending 30 September 2018:

[Note 1]

Third quarters ending 30 September 2018:

[Note 1]

Annual periods ending 30 September 2018:

Mandatory


Disclosure Initiative (Amendments to IAS 7)

Amends IAS 7 Statement of Cash Flows to clarify that entities shall provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities.

Issued: 29 January 2016

Effective date:

Effective for annual periods beginning on or after 1 January 2017

First quarters ending 30 September 2018:

[Note 1]

Second quarters ending 30 September 2018:

[Note 1]

Third quarters ending 30 September 2018:

[Note 1]

Annual periods ending 30 September 2018:

Mandatory


Clarifications to IFRS 15 'Revenue from Contracts with Customers'

Amends IFRS 15 Revenue from Contracts with Customers to clarify three aspects of the standard (identifying performance obligations, principal versus agent considerations, and licensing) and to provide some transition relief for modified contracts and completed contracts.

Issued: 12 April 2016

Effective date:

Effective for annual periods beginning on or after 1 January 2018

First quarters ending 30 September 2018:

Mandatory

Second quarters ending 30 September 2018:

Mandatory

Third quarters ending 30 September 2018:

Mandatory

Annual periods ending 30 September 2018:

Optional


Classification and Measurement of Share-based Payment Transactions (Amendments to IFRS 2)

Amends IFRS 2 Share-based Payment to clarify the standard in relation to the accounting for cash-settled share-based payment transactions that include a performance condition, the classification of share-based payment transactions with net settlement features, and the accounting for modifications of share-based payment transactions from cash-settled to equity-settled.

Issued: 20 June 2016

Effective date:

Effective for annual periods beginning on or after 1 January 2018

First quarters ending 30 September 2018:

Mandatory

Second quarters ending 30 September 2018:

Mandatory

Third quarters ending 30 September 2018:

Mandatory

Annual periods ending 30 September 2018:

Optional


Applying IFRS 9 'Financial Instruments' with IFRS 4 'Insurance Contracts' (Amendments to IFRS 4)

Amends IFRS 4 Insurance Contracts provide two options for entities that issue insurance contracts within the scope of IFRS 4:

  • an option that permits entities to reclassify, from profit or loss to other comprehensive income, some of the income or expenses arising from designated financial assets; this is the so-called overlay approach;
  • an optional temporary exemption from applying IFRS 9 for entities whose predominant activity is issuing contracts within the scope of IFRS 4; this is the so-called deferral approach.

The application of both approaches is optional and an entity is permitted to stop applying them before the new insurance contracts standard is applied.

Issued: 12 September 2016

Effective date:

Overlay approach to be applied when IFRS 9 is first applied. Deferral approach effective for annual periods beginning on or after 1 January 2018 and only available for three years after that date.

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


Transfers of Investment Property (Amendments to IAS 40)

The amendments to IAS 40 Investment Property:

  • Amends paragraph 57 to state that an entity shall transfer a property to, or from, investment property when, and only when, there is evidence of a change in use. A change of use occurs if property meets, or ceases to meet, the definition of investment property. A change in management’s intentions for the use of a property by itself does not constitute evidence of a change in use.
  • The list of examples of evidence in paragraph 57(a) – (d) is now presented as a non-exhaustive list of examples instead of the previous exhaustive list.

Issued: 8 December 2016

Effective date:

Effective for annual periods beginning on or after 1 January 2018

First quarters ending 30 September 2018:

Mandatory

Second quarters ending 30 September 2018:

Mandatory

Third quarters ending 30 September 2018:

Mandatory

Annual periods ending 30 September 2018:

Optional


Annual Improvements to IFRS Standards 2014–2016 Cycle

Makes amendments to the following standards:

  • IFRS 1 - Deletes the short-term exemptions in paragraphs E3–E7 of IFRS 1, because they have now served their intended purpose
  • IFRS 12 - Clarifies the scope of the standard by specifying that the disclosure requirements in the standard, except for those in paragraphs B10–B16, apply to an entity’s interests listed in paragraph 5 that are classified as held for sale, as held for distribution or as discontinued operations in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
  • IAS 28 - Clarifies that the election to measure at fair value through profit or loss an investment in an associate or a joint venture that is held by an entity that is a venture capital organisation, or other qualifying entity, is available for each investment in an associate or joint venture on an investment-by-investment basis, upon initial recognition

Issued: 8 December 2016

Effective date:

The amendments to IFRS 1 and IAS 28 are effective for annual periods beginning on or after 1 January 2018, the amendment to IFRS 12 for annual periods beginning on or after 1 January 2017

First quarters ending 30 September 2018:

For IFRS 12 see [Note 1]; mandatory for IFRS 1 and IAS 28

Second quarters ending 30 September 2018:

For IFRS 12 see [Note 1]; mandatory for IFRS 1 and IAS 28

Third quarters ending 30 September 2018:

For IFRS 12 see [Note 1]; mandatory for IFRS 1 and IAS 28

Annual periods ending 30 September 2018:

Mandatory for IFRS 12; optional for IFRS 1 and IAS 28


Prepayment Features with Negative Compensation (Amendments to IFRS 9)

Amends the existing requirements in IFRS 9 regarding termination rights in order to allow measurement at amortised cost (or, depending on the business model, at fair value through other comprehensive income) even in the case of negative compensation payments.

Issued: 12 October 2017

Effective date:

Annual periods beginning on or after 1 January 2019

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28)

Clarifies that an entity applies IFRS 9 Financial Instruments to long-term interests in an associate or joint venture that form part of the net investment in the associate or joint venture but to which the equity method is not applied.

Issued: 12 October 2017

Effective date:

Annual periods beginning on or after 1 January 2019
Not yet endorsed for use in the EU.

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


Annual Improvements to IFRS Standards 2015–2017 Cycle

Makes amendments to the following standards:

  • IFRS 3 and IFRS 11 - The amendments to IFRS 3 clarify that when an entity obtains control of a business that is a joint operation, it remeasures previously held interests in that business. The amendments to IFRS 11 clarify that when an entity obtains joint control of a business that is a joint operation, the entity does not remeasure previously held interests in that business.
  • IAS 12 - The amendments clarify that the requirements in the former paragraph 52B (to recognise the income tax consequences of dividends where the transactions or events that generated distributable profits are recognised) apply to all income tax consequences of dividends by moving the paragraph away from paragraph 52A that only deals with situations where there are different tax rates for distributed and undistributed profits.
  • IAS 23 - The amendments clarify that if any specific borrowing remains outstanding after the related asset is ready for its intended use or sale, that borrowing becomes part of the funds that an entity borrows generally when calculating the capitalisation rate on general borrowings.

Issued: 12 December 2017

Effective date:

Annual periods beginning on or after 1 January 2019
Not yet endorsed for use in the EU.

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


Plan Amendment, Curtailment or Settlement (Amendments to IAS 19)

The amendments in Plan Amendment, Curtailment or Settlement (Amendments to IAS 19) are:

  • If a plan amendment, curtailment or settlement occurs, it is now mandatory that the current service cost and the net interest for the period after the remeasurement are determined using the assumptions used for the remeasurement.
  • In addition, amendments have been included to clarify the effect of a plan amendment, curtailment or settlement on the requirements regarding the asset ceiling.

Issued: 7 February 2018

Effective date:

Annual periods beginning on or after 1 January 2019
Not yet endorsed for use in the EU.

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


Amendments to References to the Conceptual Framework in IFRS Standards

Together with the revised Conceptual Framework published in March 2018, the IASB also issued Amendments to References to the Conceptual Framework in IFRS Standards. The document contains amendments to IFRS 2, IFRS 3, IFRS 6, IFRS 14, IAS 1, IAS 8, IAS 34, IAS 37, IAS 38, IFRIC 12, IFRIC 19, IFRIC 20, IFRIC 22, and SIC-32. Not all amendments, however update those pronouncements with regard to references to and quotes from the framework so that they refer to the revised Conceptual Framework. Some pronouncements are only updated to indicate which version of the framework they are referencing to (the IASC framework adopted by the IASB in 2001, the IASB framework of 2010, or the new revised framework of 2018) or to indicate that definitions in the standard have not been updated with the new definitions developed in the revised Conceptual Framework.

Issued: 29 March 2018

Effective date:

Annual periods beginning on or after 1 January 2020
Not yet endorsed for use in the EU.

First quarters ending 30 September 2018:

Optional

Second quarters ending 30 September 2018:

Optional

Third quarters ending 30 September 2018:

Optional

Annual periods ending 30 September 2018:

Optional


Editorial Corrections (various)

The IASB periodically issues Editorial Corrections and changes to IFRSs and other pronouncements. Since the beginning of calendar 2013, such corrections have been made in March 2013, September 2013, November 2013, March 2014, September 2014, December 2014, March 2015, April 2015, September 2015, December 2015, March 2016, May 2016, September 2016, December 2016, September 2017, and November 2017.

Note: For details of these editorial corrections, see our IASB editorial corrections page.

Effective date:

As minor editorial corrections, these changes are effectively immediately applicable under IFRS


 

 

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.