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Monthly roundup - November 2012

Staying on top of developments

Author: Deepesh Malik and Debbie Hankey, Accounting Technical Group

November 2012 edition
Issued 05 December 2012

In this edition:

Monthly highlights

Preparing for the December reporting season

For those preparing for the December reporting period, the following Deloitte publications may be of assistance to you:

The Australian Securities & Investment Commission (ASIC) has also released the results of its review of financial reports for years ended 30 June 2012, and announced its areas of focus for 31 December 2012 financial reports. ASIC’s future focus areas will include

  • revenue recognition and expense deferral policies;
  • asset values and the disclosure of associated assumptions;
  • off-balance sheet arrangements; and
  • going concern assessments.

For the entities disclosing non-IFRS information in their financial reports, director’s reports and market releases, it would be worthwhile to look at the ASIC Regulatory Guide 230 Disclosing non-IFRS financial information (PDF 383kb). ASIC intends to ensure proper balanced use of non-IFRS information, and will be monitoring financial reports and releases in this regard (Deloitte Accounting alert).

Entities should also note that ASIC has released draft guidance on effective disclosure in an operating and financial review (OFR) in the directors’ report. Although the regulatory guidance is not expected to be effective for December 2012 year ends (it’s expected to be released by March 2013 effective for June 2013 year ends); it provides an indication of ASIC's view on the requirements of the Law. The draft guide also provides commentary on the current use, perhaps over-use, of the unreasonable prejudice exemption in relation to disclosures around the company’s business strategies and prospects for future financial years, and is accompanied by more prescriptive guidance on its application. For further details, please refer Deloitte Accounting alert (PDF 404kb).

New pronouncements

(A listing of new accounting standards, interpretations, exposure drafts, discussion papers and similar documents issued during the month by the AASB and IASB/IFRIC, along with other IFRS-related documents by other bodies that may be of interest and related links to Deloitte publications and alerts. See also our What’s new in the December 2012 financial reporting cycle summary.)

International Accounting Standards Board (IASB)
Pronouncement Key dates More information

Exposure Draft ED/2012/2 Annual Improvements to IFRSs 2011–2013 Cycle

Provides clarifications on certain issues:

  • Meaning of effective IFRSs on first time adoption (IFRS 1 First-time Adoption of International Financial Reporting Standards)
  • Scope of exception for joint ventures applies only to the financial statement of the arrangements themselves not the joint venture participants (IFRS 3 Business Combinations)
  • Scope of portfolio exception (IFRS 13 Fair Value Measurement)
  • Interrelationship of IFRS 3 and IAS 40 Investment Property to determine whether acquisition of investment property is a business.

The proposed effective date for the amendments is for annual periods beginning on or after 1 January 2014, although entities are permitted to early adopt.

Comments due by 18 February 2013

IAS Plus article

ED 2012/2 (PDF 140kb)

Exposure Draft ED/2012/3 Equity Method: Share of Other Net Asset Changes

Proposes limited scope amendments to IAS 28 Investments in Associates and Joint Ventures to require an investor to recognise directly in equity the investor’s share of any changes in the net assets of an investee that are not recognised in ‘profit or loss’ or ‘other comprehensive income’ of the investee, and that are not distributions received by the investor from the investee An example would be when an associate issues new shares to third parties that changes an investor’s ownership interest in the associate.

Proposes an investor reclassify to ‘profit or loss’ the cumulative amount of equity that the investor had previously recognised when the investor discontinues the use of the equity method – when its investment ceases to be an associate or a joint venture.

Comments due by 22 March 2013

IAS Plus article

ED 2012/3 (PDF 149kb)

Exposure Draft ED/2012/4 Classification and Measurement: Limited Amendments to IFRS 9 (proposed amendments to IFRS 9 (2010))

Proposes limited amendments to classification and measurement requirements of IFRS 9 that includes a proposal to introduce a fair value through other comprehensive income (OCI) measurement category for particular financial assets when two conditions are met:

  • the contractual cash flows of the assets are solely payments of principal and interest and
  • the assets are used in a business model which is neither to exclusively hold nor sell.
Comments due by 28 March 2013

IAS Plus article

ED 2012/4 (PDF 409kb)

IASB snapshot

IASB webcast (link to site)

Australian Accounting Standards Board (AASB)
Pronouncement Key dates More information

Exposure Draft ED 228 Equity Method: Share of Other Net Asset Changes

Incorporates IASB ED/2012/3, discussed above

Comments to the AASB due by 8 February 2013 and to the IASB by 22 March 2013

ED 228 (PDF 277kb)

Exposure Draft ED 229 Annual Improvements to IFRSs 2011–2013 Cycle

Incorporates IASB ED/2012/2, discussed above

Comments to the AASB due by 4 February 2013 and to the IASB by 18 February 2013

ED 229 (PDF 325kb)

Standard setter meetings

(A listing of meetings of various standard setters during the month or where documents were issued during the month in respect of the previous month’s meetings, with links to our analysis, agenda papers and so on)

Meeting Highlights More information
IFRIC regular meeting
13-14 November 2012

Key issues discussed include:

  • IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets, IFRIC 12 Service Concession Arrangements — Variable payments for the separate acquisition of PPE and intangible assets
  • IFRS 3 Business Combinations — Accounting for reverse acquisition transactions where the acquiree is not a business
  • IAS 19 Employee Benefits — Accounting for contribution based promises
  • IAS 19 Employee Benefits — Measurement of the net DBO for post employee benefit plans with employee contributions
  • IAS 10 Events after the Reporting Period — Reissue of financial statements
  • IAS 34 Interim Financial Reporting — Disclosure of information "elsewhere in the interim financial report"
  • IAS 1 Presentation of Financial Statements — Disclosures requirements about assessment of going concern
  • IFRS 3 Business Combinations — Mandatory purchase of NCI in business combination obtaining control of listed entity
  • IAS 19 Employee Benefits — Determination of discount rate
  • IAS 37 Provisions, Contingent Liabilities and Contingent Assets and IFRIC 6 Liabilities arising from Participating in a Specific Market— Waste Electrical and Electronic Equipment — IFRIC draft Interpretation DI/2012/1 Levies charged by public authorities on entities that operate in a specific market
Deloitte observer notes

IFRIC update (PDF 62kb)

IFRIC podcast (mp3, link to site)
IASB regular meeting
19-23 November 2012

Topics discussed were as follows (click on the links for direct access to the Deloitte observer notes for that topic):

Deloitte Observer notes

IASB update (PDF 519kb)


New Deloitte publications

(Key IFRS-related and other publications issued by Deloitte during the month, not covered elsewhere. You can find full details and back issues of our various publications by following these links: Accounting alerts, IAS Plus publications, IFRS in Focus Newsletters, Webcasts, and Podcasts)

IFRS publications
Other publications
Deloitte webcast/podcast
  • Dbriefs webcast — IFRS: Important Developments (November 2012) (link to website) discusses the IASB work plan, the financial instruments project, the consolidation project (focusing on investment entities), and provides an update on the leases and revenue recognition projects
  • Stay Tuned Online – IFRS and UK GAAP update (link to IAS plus) run by the Deloitte London IFRS Centre of Excellence on latest IFRS and other financial reporting issues. The topics covered in the November 2012 webcast include:
    • New consolidation rules for investment entities
    • Corporate governance developments
    • Narrative reporting and ‘joined up writing’
    • New IFRS reduced disclosure framework and an update on the future of UK GAAP
    • Other developments.
Deloitte comment letters
  • Deloitte comment letter (PDF 56kb) to the International Accounting Standards Board (IASB) regarding its Request for Information on the post-implementation review of IFRS 8 Operating Segments
  • Deloitte comment letter (PDF 158kb) to the IASB on its Request for Information 'Comprehensive Review of the IFRS for SMEs'
  • Deloitte comment letter to the IFRS Interpretations Committee (IFRIC) on four tentative agenda decisions published in the September 2012 edition of 'IFRIC Update'.

Other developments

(A brief listing of other financial reporting developments during the month. A full summary of all IFRS-related developments can be found in our November historical summary on IAS Plus. You can also subscribe to our Deloitte IAS Plus RSS feed to be kept informed of developments as they happen)

Australian-specific topics
  • The Australian Securities & Investment Commission (ASIC) has released the results of its reviews of financial reports for years ended 30 June 2012, and announced its areas of focus for 31 December 2012 financial reports (ASIC media release)
  • The Australian Securities Exchange (ASX) has received regulatory approval to introduce new listing rules to enhance disclosure of reserves and resources by ASX-listed mining exploration and production companies, and oil and gas exploration and production companies (ASX company update, media release)
  • The 'Australian Accounting Review' has recently published a special edition that marks the 10th anniversary of the International Accounting Standards Board (IASB) with research papers exploring the impact of IFRS on standard setting, financial reporting practice and accounting education from the perspectives of standard setters, practitioners and academics (IAS Plus article)
  • The Australian Accounting Standards Board (AASB) has written a letter (PDF 207kb) to the International Accounting Standards Board (IASB) expressing concerns about the direction of some of the IASB’s recent discussions on the revenue recognition project, including the possible re-introduction of a 'collectibility threshold' for revenue (IAS Plus article).
International Accounting Standards Board
  • The International Accounting Standards Board (IASB) has released a revised work plan (23 Nov) following a number of recently published pronouncements
  • IASB Investor perspectives 'Investors, preparers and the IASB agree on consolidation exception for investment entities' reviews the main issues the IASB had to consider while developing the amendments.
External Podcasts
  • IFRIC podcast (link to website) provides an overview of some of the issues discussed at the November 2012 IFRS Interpretations Committee meeting, including IAS 1 Presentation of Financial Statements—Disclosures about going concern, IAS 19 Employee Benefits—Actuarial assumptions: discount rate and IAS 37 Provisions, Contingent liabilities and Contingent Assets—Interpretation on levies
  • IASB webcast (link to website) on the proposals included in the recently issued Exposure Draft 'Classification and Measurement: Limited Amendments to IFRS 9'.
Other global news
  • The European Securities and Markets Authority (ESMA) has announced the priority issues (PDF 164kb) that the assessment of listed companies' 2012 financial statements will focus on (IAS Plus article)
  • The New Zealand External Reporting Board (XRB) and New Zealand Accounting Standards Board (NZASB) have released a "for-profit package" of standards which represent the first step toward the implementation of New Zealand's new Accounting Standards Framework (IAS Plus article)
  • The NZASB has tentatively decided to adopt the same strategy as the AASB, and delay adoption of the IASB's investment entities amendments in the New Zealand context until an exposure draft can be issued proposing additional disclosures (IAS Plus article)
  • The IFRS committee of the Accounting Standards Committee of Germany (ASCG) has released an analysis (PDF 145kb) of the IASB's review draft on hedge accounting published in September 2012 (IAS Plus article)
  • The chairman of the G20’s Financial Stability Board (FSB) has called on the IASB and United States Financial Accounting Standards Board (FASB) to resolve their differences on major convergence issues, especially the development of a common model for loan impairment provisioning. The communiqué outlining the outcomes of a meeting of the G20 Ministers of Finance and Central Bank Governors notes 'concern about the slow progress achieved toward a single set of high quality accounting standards' (IAS Plus article).

Related links

Related links

  • Monthly roundup - October 2012
    Financial reporting developments during October 2012. Monthly highlights discuss the recently issued investment entity consolidation amendments by the IASB; and the developments in the IASB lease project
  • Monthly roundup - July 2012
    Financial reporting developments during July 2012. Monthly highlights discuss the financial reporting implications of tax ruling on frankable dividends, IASB revised work plan and Transitional relief and guidance on IFRS 10, IFRS 11, and IFRS 12
  • Monthly roundup - November 2011
    Financial reporting developments during November 2011. Monthly highlight is the discussion on the revised exposure draft on revenue
  • Monthly roundup - July 2013
    Financial reporting developments during July 2013. Monthly highlights discuss the ASIC areas of focus for July 2013 reporting period.
  • Monthly roundup - June 2013
    Financial reporting developments during June 2013. Monthly highlights discuss the ASIC areas of focus for June 2013 reporting period.
  • Monthly roundup - March 2011
    Financial reporting developments during March 2011. Monthly highlight discusses the updated IASB work plan, ASIC's proposed guidance on additional financial information and a joint UK/NZ project to reduce disclosures under IFRS.
  • Monthly roundup - March 2009
  • Monthly roundup - November 2010
    Financial reporting developments during November 2010. Monthly highlight discusses resources available for the December reporting season and the IASB's updated work plan issued late in the month.
  • Monthly roundup - August 2010
    Summary of developments in financial reporting during August 2010. Monthly highlight discusses the possible impact of changes in the IASB and FASB chairs on global standard setting.
  • Monthly roundup - June 2010
    Summary of developments in financial reporting during June 2010. Monthly highlight discusses recent financial reporting reform.


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