Monthly roundup - November 2012
Staying on top of developments
November 2012 edition
Issued 05 December 2012
In this edition:
- Monthly highlights
- New pronouncements
- Standard setter meetings
- New Deloitte publications
- Other developments
Preparing for the December reporting season
For those preparing for the December reporting period, the following Deloitte publications may be of assistance to you:
- What’s new in the December 2012 financial reporting cycle
- Half year Model Financial Statements - 31 December 2012 HYE (AIFRS)
- Full year Model Financial Statements - 31 December 2012 YE (IFRS)
- Interim compliance checklist (IFRS)
- IFRS compliance, presentation and disclosure checklist 2011
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Entities should also note that ASIC has released draft guidance on effective disclosure in an operating and financial review (OFR) in the directors’ report.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).
(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:
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|
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|
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:
|Comments due by 28 March 2013||
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)
(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)
|IFRIC regular meeting
13-14 November 2012
Key issues discussed include:
|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 on Point — IFRS Accounting Developments and Information: October 2012 (PDF 109kb) highlights the month’s important IFRS developments and information
- IASB Project Insights provide a quick overview of the current status of the key projects of the IASB. New updates posted in November 2012: Revenue recognition (PDF 107kb) and Financial Instruments: Impairment (PDF 84kb)
- IFRS in Focus — Fair value rules — new requirements for investment entities (PDF 80kb) discusses the recent amendment to IFRS 10 'Consolidated Financial Statements' to provide an exception to the consolidation requirement for entities that meet the definition of an investment entity. (Please note that the AASB has tentatively decided to delay adoption of these amendments in Australia – see October monthly roundup for details).
- Interim compliance checklist (IFRS) - an updated checklist (Excel 80kb) of the requirements of IAS 34 Interim Financial Reporting that addresses the requirements of IAS 34 at 30 June 2012
- Half year Model Financial Statements - 31 December 2012 HYE (AIFRS) illustrating compliance with the presentation and disclosure requirements of Australian Accounting Standards and other requirements.
- 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'.
(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)
- 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.
- 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).