References

• IAS 1 Presentation of Financial Statements

History

• SIC D29 Issued July 2001.
• Final SIC 29 Disclosure – Service Concession Arrangements was approved by the IASB in December 2001.

Summary of SIC D29

SIC D29 considers the information that should be disclosed in the notes to the financial statements by both parties to a service concession arrangement.

A service concession arrangement exists when an enterprise (the Concession Operator) agrees with another enterprise (the Concession Provider) to provide services that are normally considered public services. Examples of service concession arrangements involve water treatment and supply facilities, motorways, car parks, tunnels, bridges, airports and telecommunication networks. Examples of arrangements that are not service concession arrangements include an enterprise outsourcing the operations of its internal services (e.g., employee cafeteria and accounting or information technology functions).

The following should be disclosed in each period:

• description of the arrangement;
• significant terms such as the period of the concession, contractual re-pricing dates, and the basis upon which re-pricing or re-negotiation is determined;
• the nature and extent (quantity, time period, or amount as appropriate) of the following:
  • transferred rights to use specified assets;
  • obligations to provide or rights to expect provision of services;
  • obligations to acquire or build items of property, plant and equipment;
  • obligations to deliver or rights to receive specified assets at the end of the concession period;
  • renewal options;
  • other rights and obligations (e.g., major overhauls); and
• changes in the arrangement occurring during the period.

Issued for public comment on 9 July 2001. Comment deadline 10 September.

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