The International Accounting Standards Board (IASB) regularly publishes new International Financial Reporting Standards (IFRS), Interpretations of Standards (IFRIC) or amendments to existing IFRS Standards.
In response to these, the global IFRS team publishes IFRS Alerts on these changes (and other issues relevant to IFRS) as they are announced so that you can keep up to date.
Grant Thornton International Ltd is pleased to share our Alerts with you below.
| Issue 2024-05 |
November 2024 Hyperinflation UpdateAccording to data in the World Economic Outlook (WEO) report issued by the International Monetary Fund (IMF) in October 2024, and based on economic conditions that currently exist, certain countries are now considered to be hyperinflationary from 31 December 2024. Therefore, reporting entities in those countries will be required to apply IAS 29 'Financial Reporting in Hyperinflationary Economies'. Consequently, any entities with interim or annual financial reporting requirements at 31 December 2024 or thereafter should reflect IAS 29 in their IFRS financial statements. From 31 December 2024 onwards there are fifteen countries around the world where IAS 29 should be applied, when entities want to state they are in full compliance with IFRS. These countries are: Argentina, Ethiopia, Ghana, Haiti, Iran, Laos, Lebanon, Malawi, Sierra Leone, South Sudan, Suriname, Turkey, Venezuela, Yemen and Zimbabwe. Additional considerations were made to determine if South Sudan and Ghana are still hyperinflationary. For the time being, they remain hyperinflationary but we will be keeping a close eye on further inflation data from these countries. Egypt and Nigeria were also assessed due to high inflation numbers for the preceding three-year period. However, in both cases certain qualitative factors were considered and for now neither is considered to be hyperinflationary. A close eye should be kept on further inflation data from both of these countries. Recapping the requirements of IAS 29 The mechanics of restatement​
Other important factors that should be taken into consideration when applying IAS 29 IAS 29 may result in the creation of additional temporary differences under IAS 12 ‘Income Taxes’. This is because the restatement of items under IAS 29 will often lead to adjustments to the carrying amounts of items without corresponding changes to their tax bases. Be mindful that IAS 12 requires these adjustments to be recognised in profit or loss.​ Impairment testing should also not be overlooked. IAS 29 requires any restated non-monetary items to be reduced when it exceeds its recoverable amount, even if those assets were not previously considered impaired under historical cost accounting. It will be important when preparing financial statements to consider whether the restatement of asset carrying values affects the results of impairment tests that were conducted in previous reporting periods, and whether there are any indicators of impairment for assets that were not tested for impairment in previous periods.​ IFRIC decisions relating to hyperinflation​
We encourage careful consideration of these issues when preparing IFRS financial statements and applying IAS 29.​ Our thoughts Any reporting entity considering IAS 29 for the first time will have to adapt their existing accounting systems to be able to process the hyperinflationary adjustments. It is important they understand the mechanics of adjusting for hyperinflation so they can restate in their financial statements both current and comparative periods.​ |
| Issue 2024-04 |
IASB issues annual improvements to IFRS Accounting StandardsThe International Accounting Standards Board (IASB) has published 'Annual Improvements to IFRS Accounting Standards – Volume 11' addressing non-urgent (but necessary) minor amendments to five Standards, as described below. Background The publication is a collection of amendments to IFRS Standards discussed by the IASB during the current project cycle for annual improvements. The IASB uses the Annual Improvements process to make necessary, but non-urgent, amendments to IFRS Standards that will not be included as part of any other project. By presenting the amendments in a single document rather than as a series of piecemeal changes, the IASB aims to ease the burden of change for all concerned. A summary of the issues addressed is set out below: Effective date Our thoughts |
| Issue 2024-03 |
Amendments to the Classification and Measurement of Financial InstrumentsThe International Accounting Standards Board (IASB) has issued amendments to IFRS 9 ‘Financial Instruments’ and some amendments have also been made to IFRS 7 ‘Financial Instruments: Disclosures’, following a post-implementation review (PIR) of IFRS 9. The amendments also include consequential changes to IFRS 19 ‘Subsidiaries without Public Accountability: Disclosures’ to reflect the amendments made to IFRS 7. Background
To address these matters and to improve clarity and understanding, the IASB has issued some amendments to the classification and measurement of financial instruments to promote consistency. The amendments
Classification of financial assets IFRS 9 also describes certain situations where financial assets may have contractual cash flows that are described as principal and interest, but the payments made do not actually represent a basic lending arrangement. This may be the case if a financial asset has non-recourse features. The amendments to IFRS 9 provide a clearer definition of a non-recourse feature, which is now outlined as a financial asset where the entity’s ultimate right to receive cash flows is contractually limited to the cash flows generated by specified assets. Contractually linked instruments IFRS 7: Disclosures Contractual terms that could change the amount of contractual cash flow based on contingent events Effective date An entity is required to apply these amendments retrospectively. However, an entity is not required to restate prior periods to reflect the application of the amendments unless it can clearly demonstrate that hindsight has not been used to make those changes. Our thoughts The guidance set out in these amendments for preparers on the derecognition of financial liabilities settled through electronic transfer will be helpful. So will the amendments clarifying how to assess the contractual cash flows characteristics of financial assets when ESG-linked features are present, when non-recourse features exist and when contractually linked arrangements are in place. For investors the additional disclosure requirements now reflected in IFRS 7, to deal with both financial equity investments designated at fair value through other comprehensive income and financial instruments with contractual terms that could change the timing or amount of contractual cash flows on the occurrence (or non-occurrence) of a contingent event, will be insightful.
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| Issue 2024-02 |
IFRS 19 – Simplifying financial reporting for eligible subsidiaries Following last month’s release of IFRS 18 ‘Presentation and Disclosure in Financial Statements’, the International Accounting Standards Board (IASB) has published another new standard — IFRS 19 ‘Subsidiaries without Public Accountability: Disclosures’ (the Standard). The new Standard creates a reduced set of disclosures that certain in-scope entities can elect to apply instead of the disclosure requirements set out in other IFRS. IFRS 19 will work alongside other IFRS, with eligible subsidiaries applying the measurement, recognition and presentation requirements set out in other IFRS and the revised disclosures outlined in IFRS 19. The objective of the Standard is to alleviate the reporting burden for subsidiaries without public accountability. Background IFRS for SMEs has fewer disclosure requirements than full application of IFRS; however, the recognition and measurement requirements differ to those of full IFRS. As a result, some subsidiaries choose not to take advantage of the reduced disclosures for IFRS for SMEs as it results in additional accounting to agree information reported to the parent entity with full IFRS recognition and measurement principles. This new Standard aims to create a more attractive option for subsidiaries without public accountability. Eligible entities will now be able to elect to apply IFRS 19, which has the same recognition, measurement, and presentation principles as full IFRS, but allows for specific reduced disclosures in most topic areas. The IASB believes IFRS 19 will provide a solution that will alleviate the reporting burden for in-scope entities. Scope
For purposes of applying IFRS 19, an entity has public accountability if:
Disclosure requirements Standards with no reduced disclosures
Subsidiaries that are eligible to apply IFRS 19 are not required to apply IAS 33 or IFRS 8 but may do so voluntarily. If either are applied, the full disclosures required by IAS 33 or IFRS 8 will apply. Maintenance of IFRS 19 Effective date of IFRS 19 Our thoughts While the effective date is a while away, we would encourage entities to consider whether they are eligible and to assess whether applying IFRS 19 would reduce their reporting burden. We have plans to release an article later in the year that will provide a more detailed look at the requirements of this Standard. |
| Issue 2024-01 |
Introducing IFRS 18 – The IASB’s new presentation and disclosure standard On 9 April 2024 the International Accounting Standards Board (IASB) published a new standard, its first since 2017. The new standard, IFRS 18 ‘Presentation and Disclosure in Financial Statements’ (the Standard) replaces IAS 1 ‘Presentation of Financial Statements’ and will impact every reporting entity that currently uses International Financial Reporting Standards (IFRS). The objective of the Standard is to improve how information is communicated in an entity’s financial statements, particularly in the statement of profit or loss and in its notes to the financial statements. Key changes
Background
This led to diversity in practice as entities defined their own subtotals and performance measures, which made comparison of financial performance between entities difficult for investors. The IASB believes IFRS 18 will resolve these issues and improve the overall quality of financial reporting. The key changes in the new Standard Changes to presentation requirements in the statement of profit or loss Firstly, the Standard introduces two new defined subtotals:
These new required subtotals are intended to increase comparability by ensuring that information presented for investors is consistent across different entities. Additionally, the Standard requires an entity to classify all income and expenses into one of the following five categories:
The investing category includes income and expenses from investments in associates, joint ventures and unconsolidated subsidiaries, cash and cash equivalents, and any other assets (such as cash and cash equivalents) that generate returns separately from the entity’s other resources. The financing category distinguishes between transactions that are solely for the purpose of raising finance, and those that are not. Income and expenses from all liabilities that result solely from the raising of finance are included in this category, along with some elements of interest income or expense recognised by applying other IFRS. This category, together with the subtotal for profit before financing and income taxes enables investors to assess the reporting entity’s performance before the effects of its financing. The income taxes and discontinued operations categories include income and expenses resulting from the application of IAS 12 ‘Income taxes’ and any related foreign exchange differences, and IFRS 5 ‘Non-current assets held for sale and discontinued operations’ respectively. Finally, the operating category includes all other items of income and expense that are not allocated to one of the other four categories. It is a default category, so it is important to note this category will include income and expenses from an entity’s main business activities, regardless of whether the income or expenses are volatile or unusual. The operating profit subtotal provides not only a measure of past performance, but also a starting point for forecasting an entity’s future cash flows. Foreign exchange differences Entities with specified main business activities When a reporting entity has assessed that it invests in assets as its main business activity, income and expenses are split between the investing category and operating category, depending on how the underlying assets are accounted for. For all assets accounted for using the equity method, income and expenses are included in the investing category, and for all other assets income and expenses are included in the operating category. When a reporting entity has assessed that it provides financing to customers as its main business activity, it will classify income and expenses from liabilities relating to providing such finance in the operating category. The assessment of an entity’s main business activities is therefore going to be a key judgement which may significantly impact the geography of where items appear in the statement of profit or loss. This is likely to prove particularly challenging for mixed groups and groups of reporting entities which provide multiple services. New requirements to be included in the notes to the financial statements
Management-defined performance measures MPMs are subtotals of income and expenses other than those listed by IFRS 18 or specifically required by another IFRS, that an entity uses:
Alongside any MPMs that are disclosed, a reporting entity will also be required to disclose information including:
These disclosures will be required for any measure that meets the definition of a MPM and when applicable and they must be included in a single note in the reporting entity’s financial statements. Updated guidance for the aggregation and disaggregation of information
Changes to how expenses in the operating category are presented Consequential changes made to other standards Elsewhere, IAS 33 ‘Earnings per Share’ (EPS) requirements have been amended to permit an entity to disclose additional EPS information over and above reporting basic and diluted EPS amounts. However, additional amounts can only be included in the EPS calculation if the numerator is either a total or subtotal identified in IFRS 18 or a MPM. IAS 34 ‘Interim Financial Reporting’ has also been updated to require disclosure of information about MPMs in interim financial statements and guidance is now provided on how subtotals should be dealt with in interim financial statements. Effective date of IFRS 18 Our thoughts While the effective date is a while away, we would encourage entities to start considering the impact sooner rather than later. To assist with this, we have plans to release a ‘Getting ready for IFRS 18’ guide later in the year that will provide a more detailed look at the requirements of this Standard, and the likely impact on reporting entities. |
| Issue 2023-05 |
December 2023 Hyperinflation update The WEO report also identifies that South Sudan might no longer be a hyperinflationary economy from 31 December 2023. From 31 December 2023 onwards there are thirteen countries around the world where IAS 29 should be applied, when entities want to state they are in full compliance with IFRS. These countries are: Argentina, Ethiopia, Ghana, Haiti, Iran, Lebanon, Sierra Leone, Sudan, Suriname, Turkey, Venezuela, Yemen (which should be closely monitored) and Zimbabwe. Recapping the requirements of IAS 29 Indicators of hyperinflation The mechanics of restatement
Other important factors that should be taken into consideration when applying IAS 29 IAS 29 may result in the creation of additional temporary differences under IAS 12 ‘Income Taxes’. This is because the restatement of items under IAS 29 will often lead to adjustments to the carrying amounts of items without corresponding changes to their tax bases. Be mindful that IAS 12 requires these adjustments to be recognised in profit or loss. Impairment testing should also not be overlooked. IAS 29 requires any restated non-monetary items to be reduced when it exceeds its recoverable amount, even if those assets were not previously considered impaired under historical cost accounting. It will be important when preparing financial statements to consider whether the restatement of asset carrying values affects the results of impairment tests that were conducted in previous reporting periods, and whether there are any indicators of impairment for assets that were not tested for impairment in previous periods. IFRIC decisions relating to hyperinflation
We encourage careful consideration of these issues when preparing IFRS financial statements and applying IAS 29. Our thoughts Any reporting entity considering IAS 29 for the first time will have to adapt their existing accounting systems to be able to process the hyperinflationary adjustments. It is important they understand the mechanics of adjusting for hyperinflation so they can restate in their financial statements both current and comparative periods. |
| Issue 2023-04 |
IASB issues amendments to the IFRS for SMEs to help entities respond to the Pillar Two tax rules The International Accounting Standards Board (IASB) has amended the IFRS for SMEs. The amendments, entitled ‘International Tax Reform—Pillar Two Model (Amendments to the IFRS for SMEs)’ are based on the amendments to IAS 12 ‘Income Taxes’ issued in May 2023, and address the impacts of the introduction of the Organisation for Economic Co-operation and Development’s (OECD) Pillar Two Model Rules. The amendments introduce a temporary exception and targeted disclosure requirements. Background However, while the reaction from jurisdictions around the world to implement the changes has been positive, there have been major stakeholder concerns about the uncertainty over the accounting for deferred taxes arising from the implementation of these rules. Those concerns mainly refer to identifying and measuring deferred taxes, because determining whether the Pillar Two Model Rules will create additional temporary differences is very difficult, and also which tax rate will be applicable (considering the number of factors affecting its determination). Following similar amendments to IAS 12 ‘Income Taxes’, issued in May 2023, the IASB has issued these ‘out-of-cycle’ amendments to the IFRS for SMEs to provide direction on what they expect entities to disclose. The amendments
Entities can benefit from this temporary exception immediately and are required to provide the disclosures set out in the amendments for reporting periods beginning on or after 1 January 2023. Our thoughts Similarly, we commend the IASB for moving quickly to extend the guidance and relief to entities who report under the IFRS for SMEs, as they too face uncertainty due to the Pillar Two Model Rules. |
| Issue 2023-03 |
Lack of exchangeability The International Accounting Standards Board (IASB) has amended IAS 21 ‘The Effects of Changes in Foreign Exchange Rates’ to clarify the approach that should be taken by preparers of financial statements when they are reporting foreign currency transactions, translating foreign operations, or presenting financial statements in a different currency, and there is a long-term lack of exchangeability between the relevant currencies. The amendments
The additional disclosure requirements provide useful information about the additional level of estimation uncertainty, and risks arising for the entity due to the lack of exchangeability. The amendments to IAS 21 are effective for accounting periods on or after 1 January 2025, with earlier application permitted. Our thoughts |
| Issue 2023-02 |
IASB issues amendments to enhance the transparency of supplier finance arrangements The amendments require additional disclosures that complement the existing disclosures in these two Standards. They require entities to disclose:
These additional disclosure requirements address investors wanting more visibility around supplier finance arrangements, which in some jurisdictions around the world are better known are reverse factoring arrangements. The amendments to IAS 7 and IFRS 7 are effective for accounting periods on or after 1 January 2024. Our thoughts |
| Issue 2023-01 |
IASB amends IAS 12 to help entities respond to the 'Pillar Two' tax rules The International Accounting Standards Board (IASB) has issued amendments to IAS 12 ‘Income taxes’ to give entities temporary relief from accounting for deferred taxes arising from the Organisation for Economic Co-operation and Development’s (OECD) international tax reform. The amendments introduce both a temporary exception and some targeted disclosure requirements. Background However, while the reaction from jurisdictions around the world to implement the changes has been positive, there have been major stakeholder concerns about the uncertainty over the accounting for deferred taxes arising from the implementation of these rules. Those concerns mainly refer to identifying and measuring deferred taxes because determining whether the Pillar Two Rules will create additional temporary differences is very difficult and also which tax rate will be applicable (considering the number of factors affecting its determination). Therefore, the IASB has acted quickly to address these concerns and provide direction on what they expect entities to disclose. The amendments:
Entities are able to benefit from the temporary exception immediately as soon as the amendments are published but in providing this exemption they are required to provide the disclosures to investors for annual reporting periods beginning on or after 1 January 2023. However, in some jurisdictions, such as Europe, the endorsement process will probably not be completed before 30 June 2023 resulting in reporting entities operating in jurisdictions where the Pillar Two Rules have been enacted or quasi enacted, being in a situation that the amendments are aiming to avoid. We are of the view that if this happens, reporting entities are able to develop their own accounting policy in accordance with the guidance of Paragraph 10 of IAS 8 ‘Accounting Policies, Changes in Accounting Estimates and Errors’. We consider that the value of the information being provided (ie relevancy, reliability, faithful presentation) is outweighed by the costs of attempting to update the deferred tax balances for Pillar Two Model Rules. Put another way, given these amendments to IAS 12 make it clear that no deferred tax is required to be recognised as a result of Pillar Two Model Rules, trying to identify and estimate any deferred tax for one period (i) in a way that might not be consistent with how other reporting entities would do it and (ii) with the only perspective to reverse it in a following period, may not end up providing reliable, consistent and decision useful information for the users of the financial statements. Our thoughts Considering some jurisdictions around the world have already substantially enacted the Pillar Two Model Rules, we commend the IASB for the speed in which they published these amendments and encourage reporting entities to consider what new disclosures are now required well ahead of any reporting obligations they might have. Listed entities in particular should take into account any views expressed by their local regulator in developing their accounting policy on this matter. |
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| Issue 2022 - 05 |
Ethiopia should now be considered a hyperinflationary economy Economic conditions that currently exist in Ethiopia will require reporting entities in that country to follow the requirements set out in IAS 29 ‘Financial Reporting in Hyperinflationary Economies’. This means that any entities that have interim or annual reporting requirements at 31 December 2022 or thereafter in Ethiopia should reflect this Standard when preparing their IFRS-based financial statements. Therefore at 31 December 2022 there are eleven countries around the world where IAS 29 should be applied, when entities want to state they are in full compliance with IFRS. These countries are: Argentina, Ethiopia, Iran, Lebanon, South Sudan, Sudan, Suriname, Turkey, Venezuela, Yemen and Zimbabwe. Currently there are four countries that are potentially hyperinflationary and therefore should be closely monitored. They are: Angola, Haiti, Sri Lanka and Syria. As further information becomes available, we will continue to update this alert. Our thoughts Any reporting entity considering IAS 29 for the first time will have to adapt their existing accounting systems to be able to process the hyperinflationary adjustments. It is important they understand the mechanics of adjusting for hyperinflation so they can restate in their financial statements both current and comparative period amounts. Download the full alert for a recap of the requirements of IAS 29. |
| Issue 2022 - 04 |
IASB amends IAS 1 to provide better disclosure on long-term debt with covenants The amendments set out in ‘Non-current Liabilities with Covenants (Amendments to IAS 1)’ state that at the reporting date, the entity does not consider covenants that will need to be complied with in the future, when considering the classification of the debt as current or non-current. Instead, the entity should disclose information about these covenants in the notes to the financial statements. The IASB aims for these amendments to enable investors to understand the risk that such debt could become repayable early and therefore improving the information being provided on the long-term debt. The amendments are applicable for annual reporting periods beginning on or after 1 January 2024, with early application permitted. If the amendments are applied in an earlier period, this should be disclosed. The effective date coincides with that of the amendments to IAS 1 previously issued in 2020 ‘Classification of Liabilities as Current or Non-current’. Our thoughts |
| Issue 2022 - 03 |
IASB amends the requirements for sale and leaseback transactions
The IASB has issued additional guidance in IFRS 16 on accounting for sale and leaseback transactions. Previously IFRS 16 only included guidance on how to account for sale and leaseback transactions at the date of the transaction itself. However, the Standard did not specify any subsequent accounting when reporting on the sale and lease back transaction after that date. As a result, without further requirements, when the payments include variable lease payments there is a risk that a modification or change in the leaseback term could result in the seller-lessee recognising a gain on the right of use retained even though no transaction or event would have occurred to give rise to that gain. Consequently, the IASB decided to add subsequent measurement requirements for sale and leaseback transactions to IFRS 16. The amendments are applicable for annual reporting periods beginning on or after 1 January 2024, with early application permitted. If the amendments are applied in an earlier period, this should be disclosed. |
| Issue 2022 - 02 |
Turkey should now be considered a hyperinflationary economy
Turkey has economic conditions that will now require reporting entities in that country to follow the requirements set out in IAS 29 ‘Financial Reporting in Hyperinflationary Economies’. Given this, we expect entities that have interim or annual reporting requirements at 30 June 2022 or thereafter to reflect this Standard in their financial statements. The inclusion of Turkey means that at the date of issuing this publication there are now eleven countries around the world where IAS 29 should be applied, when entities are stating they are in full compliance with IFRS. These countries are: Argentina, Iran, Lebanon, South Sudan, Sudan, Suriname, Syria, Turkey, Venezuela, Yemen and Zimbabwe. |
| Issue 2022 - 01 |
Accounting implications of the conflict in Ukraine
In light of the latest conflict in Ukraine, including the introduction of wide ranging sanctions against certain Russian companies and individuals, entities need to carefully consider the accounting implications of this situation. This IFRS Alert considers the financial reporting impact of the conflict on 31 December 2021 and subsequent year ends as well as assessing the importance of assessing going concern. |
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| Issue 2021 - 07 |
IASB provides transition option to insurers applying IFRS 17
The International Accounting Standards Board (IASB) has released a narrow-scope amendment to the transition requirements in IFRS 17 ‘Insurance Contracts’, providing insurers with an option aimed at improving the usefulness of information to investors on initial application of the new Standard. |
| Issue 2021 - 06 |
The IFRS Foundation (Foundation) has announced three significant developments to provide the global financial markets with high-quality disclosures on climate and other sustainability issues:
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| Issue 2021 - 05 |
The International Accounting Standards Board (IASB) has issued ‘Deferred Tax related to Assets and Liabilities arising from a Single Transaction’ (Amendments to IAS 12).
The amendments require an entity to recognise deferred tax on certain transactions (eg leases and decommissioning liabilities) that give rise to equal amounts of taxable and deductible temporary differences on initial recognition.
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| Issue 2021 - 04 |
The International Accounting Standards Board (IASB) has issued ‘Covid-19-Related Rent Concessions beyond 30 June 2021 (Amendment to IFRS 16)’, an extension to the practical expedient period in the amendments to IFRS 16 ‘Leases’ made last year. This extension is for one year, so the application period now extends until 30 June 2022.
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| Issue 2021 - 03 |
The IFRS Foundation has confirmed there is an urgent need for global sustainability reporting standards. Given this, its Trustees are continuing their work on the establishment of an international sustainability reporting standards board within the existing governance structure of the Foundation.
The intention is for the Trustees to produce a definitive proposal (including a road map with timeline) by the end of September 2021, possibly leading to an announcement on the establishment of a sustainability standards board at the meeting of the United Nations Climate Change Conference COP26 in November 2021.
This alert outlines the Foundation’s views about the strategic direction of its new board and their intended next steps. |
| Issue 2021 - 02 |
For entities with operations in the United Kingdom (UK) and the EU, the determination of the income tax impact on Brexit will require some significant judgements to be made.
These judgements should be based on the facts and circumstances of the reporting entity after considering the tax laws and regulations substantively enacted at 31 December 2020 because any future changes to tax laws requiring legislative activity cannot be taken into account.
The change in the UK’s tax status (because it is not longer a member of the EU) could also trigger the application of a different set of existing tax laws, which means changes to existing current and deferred tax balances may result.
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| Issue 2021 - 01 |
The International Accounting Standards Board (IASB) has now published an Exposure Draft ‘Regulatory Assets and Regulatory Liabilities’ (the ED). The ED proposes to replace IFRS 14 ‘Regulatory Deferral Accounts’ and require entities subject to rate regulation to give investors better information about their financial performance.
The proposed Standard would introduce a requirement for entities to give investors such information by reporting regulatory assets and regulatory liabilities in their statement of financial position, and related regulatory income and regulatory expense in their statement of profit or loss. |
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| Issue 2020 - 11 |
The International Accounting Standards Board (IASB) has issued a discussion paper DP/2020/2 ‘Business Combinations under Common Control’ for public consultation on possible accounting requirements of acquisitions involving the same group. These acquisitions are commonly known as business combinations under common control (BCUCC).
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| Issue 2020 - 10 |
IAS 29 ‘Financial Reporting in Hyperinflationary Economies’ requires the financial statements of any entity whose functional currency is the currency of a hyperinflationary economy to be restated for changes in the general purchasing power of that currency so that the financial information provided is more meaningful.
Below is a reminder of the accounting implications of applying IAS 29 ‘Financial Reporting in Hyperinflationary Economies’. Our view is that until further notice, IAS 29 should be applied by entities whose functional currency is the currency of the following countries:
Iran and Lebanon should be applying IAS 29 for the first time in 2020.
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| Comment letter |
ED/2019/7 General Presentation and Disclosures Our submitted comment letter on the International Accounting Standards Board's (IASB) Exposure Draft (ED) supports the reasons for the Board developing this ED, in order to improve the way information is communicated in the financial statements, particularly in the statement of profit or loss. We believe the proposals will add further consistency and clarity to the financial statements which will enhance comparability for users of financial statements. |
| Issue 2020 - 09 |
IASB issues Interest Rate Benchmark Reform Phase 2 The International Accounting Standards Board (IASB) has published Interest Rate Benchmark Reform Phase 2 |
| Issue 2020 - 08 |
IASB defers the effective date of the IAS 1 Amendments The International Accounting Standards Board (IASB) has issued an amendment to defer the effective date of the |
| Issue 2020 - 07 |
Amendments to IFRS 17 and IFRS 4 The International Accounting Standards Board (IASB) has issued ‘Amendments to IFRS 17 ‘Insurance Contracts’’ (the Amendments). The aim of the amendments is to address the concerns raised by stakeholders and help entities to more easily transition and implement the Standard. The IASB also issued an amendment to the previous insurance Standard IFRS 4, ‘Extension of the Temporary Exemption from Applying IFRS 9 (Amendments to IFRS 4)’ so that entities can still apply IFRS 9 ‘Financial Instruments’ alongside IFRS 17. |
| Issue 2020 - 06 |
Relief for lessees accounting for rent concessions during the COVID-19 pandemic The International Accounting Standards Board (IASB) has published an amendment ‘COVID-19-Related Rent Concessions (amendment to IFRS 16)’ (the amendment). The amendment adds a practical expedient to the Standard which provides relief for lessees in assessing whether specific COVID-19 rent concessions are considered to be lease modifications. Instead, if this practical expedient is applied, these rent concessions are treated as if they are not lease modifications. There are no changes for lessors. |
| Issue 2020 - 05 |
IASB issues four narrow-scope amendments to IFRS Standards The International Accounting Standards Board (IASB) has issued a collection of narrow-scope amendments to IFRS Standards. The collection includes amendments to three Standards as well as Annual Improvements to IFRS Standards, which addresses non-urgent (but necessary) minor amendments to four standards. |
| Issue 2020 - 04 |
IASB proposes relief for rent concessions during the COVID-19 pandemic The International Accounting Standards Board (IASB) published an Exposure Draft ‘COVID-19-Related Rent Concessions - Proposed amendment to IFRS 16’ (the ED). The ED proposes to add a practical expedient to the Standard which provides relief for lessees in assessing whether specific COVID-19 rent concessions are considered to be lease modifications. Instead, if this practical expedient is applied, these rent concessions are treated as if they are not lease modifications. There are no proposed changes for lessors. |
| Issue 2020 - 03 |
Accounting implications of the Coronavirus (COVID-19) outbreak The spread of the Coronavirus is impacting businesses around the world. Entities need to carefully consider the accounting implications of this situation. This IFRS Alert considers the impact of the Coronavirus on 31 December 2019 year ends. |
| Issue 2020 - 02 |
IASB Issues Classification of Liabilities as Current or Non-Current On 23 January 2020 the IASB published ‘Classification of Liabilities as Current or Non-Current (Amendments to IAS 1)’ which clarify the Standard’s guidance on whether a liability should be classified as either current or non-current. |
| Issue 2020 - 01 |
IASB proposes major changes to the primary statements and notes In December 2019 the International Accounting Standards Board (IASB) published an Exposure Draft ‘General Presentation and Disclosures’ (General Presentation ED). The General Presentation ED proposes to replace IAS 1 ‘Presentation of Financial Statements’ with a new IFRS and amend several other IFRS Standards. |
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| Issue 2019 - 01 |
IASB issues Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7) |
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| Issue 2018 - 05 | |
| Issue 2018 - 04 |
IASB issues Definition of Material (Amendments to IAS 1 and 8) |
| Issue 2018 - 03 |
Argentina expected to be declared hyper-inflationary in 2018 |
| Issue 2018 - 02 |
Conceptual Framework for Financial Reporting (Conceptual Framework) |
| Issue 2018 - 01 |
Plan Amendment, Curtailment or Settlement (Amendments to IAS 19) |
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| Issue 2017 - 07 | |
| Issue 2017 - 06 |
Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28) |
| Issue 2017 - 05 |
Prepayment Features with Negative Compensation (Amendments to IFRS 9) |
| Issue 2017 - 04 | |
| Issue 2017 - 03 | |
| Issue 2017 - 02 | |
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Issue 2017 - 01 |
Uncertainty over tax issues resulting from the UK's decision to leave the European Union |