Eye on Reporting
Monthly Financial Reporting newsletter
Welcome to the May edition of Eye on Reporting.
The International Accounting Standards Board (IASB) plans to issue an exposure draft on its decision to propose a one-year deferral of the effective date for its new revenue standard. Our latest IFRS Developments publication summarises the discussions at the IASB meeting.
Our IFRS Core Tools library has recently been updated and includes the March 2015 edition of IFRS Update. This edition provides an overview of the key requirements of pronouncements issued by the IASB and the IFRS Interpretations Committee (IFRS IC) as at 31 March 2015, as well as summarises the key features of selected IASB projects.
This month we also highlight:
- Our publication on discussions of the Transition Resource Group for Impairment of Financial Instruments about implementation issues relating to the new impairment requirements in IFRS 9
- The latest Applying IFRS publication on the decisions issued by the IFRS Interpretation Committee on the application of IFRS 11
- The exemptions provided by the Financial Market Authority to smaller businesses that offer a Discretionary Investment Management Service (DIMS).
Kimberley Crook and Graeme Bennett
Financial Accounting Advisory Services
Eye on Reporting headlines:
- Hot topics
- Other IFRS news and other updates
- Industry in focus
- On the horizon
- Events and webcasts
The International Accounting Standards Board (IASB) plans to issue an exposure draft, with a comment period of no less than 30 days, on its decision to propose a one-year deferral of the effective date for its new revenue standard, IFRS 15 Revenue from Contracts with Customers. As a result, IFRS 15 would be effective for annual periods beginning on or after 1 January 2018, with early adoption permitted. This aligns with the US Financial Accounting Standards Board’s (FASB) decision to propose a one-year deferral of the effective date of its new revenue standard. This edition of IFRS Developments summarises the discussions at the April 2015 IASB meeting.
The March 2015 edition of IFRS Update provides a high-level overview of the key requirements of each pronouncement issued by the IASB and the IFRS Interpretations Committee (IFRS IC) as at 31 March 2015 that are applicable for the first time for annual periods ended March 2015 and thereafter. IFRS Update also summarises the key features of selected IASB projects and the most recent agenda rejection notices published by the IFRS IC.
Please note that this publication is based on ‘pure’ IFRS, and do not cover New Zealand additional disclosure requirements.
Following its inaugural meeting last December, the Transition Resource Group for Impairment of Financial Instruments (ITG) met on 22 April 2015 to discuss eight implementation issues raised by stakeholders on the new impairment requirements in IFRS 9 Financial Instruments. This IFRS Developments tells you what you need to know about the issues discussed by the ITG.
Other IFRS news and other updates
In March 2015, the IFRS Interpretations Committee issued a number of agenda decisions relating to the application of IFRS 11 Joint Arrangements. Our Applying IFRS tells you what you need to know about those decisions.
Small DIMS providers benefit from reduced reporting requirements
The Financial Markets Authority (FMA) has provided smaller businesses that offer a Discretionary Investment Management Service (DIMS) relief from some financial reporting requirements.
The FMA has approved two categories of exemptions that will be available to DIMS providers who have up to $250m retail funds under management and who are licensed under Part 6 of the Financial Markets Conduct Act 2013.
The two exemptions are:
- Licensed DIMS providers with less than $100m retail funds under management are exempt from preparing financial statements that comply with generally accepted accounting practice (GAAP) and from audit and lodgement requirements. DIMS providers are still required to keep accounting records and may be required to prepare financial statements to meet their other existing company or tax reporting obligations.
- Licensed DIMS providers with $100m to $250m retail funds under management are exempt from having financial statements audited, but are still required to prepare financial statements that comply with GAAP and to lodge them with the Registrar.
The full media release can be found on the FMA’s website here.
Industry in focus
IPSASB issues RPG 3 Reporting Service Performance Information
The International Public Sector Accounting Standards Board has issued Recommended Practice Guideline RPG 3 which provides good practice principles on reporting service performance information in general purpose financial reports (GPFRs). Service performance information assists users of GPFRs to assess an entity’s service efficiency and effectiveness.
Join us for this webcast on 15 June as our panelists explore the revenue recognition implementation issues for pharma, biotech and medtech companies. The discussion will include:
- An update on the standard and potential changes being considered by the Transition Resource Group
- Practical application issues specific for life sciences companies
- Implementation challenges including project set up, contract selection and use of tools.
The webcast will be hosted by Scott Bruns, EY Global Life Sciences Assurance Leader. Please register here.
On the horizon
Below are recent proposals that are currently open for comment to the NZASB, IASB and/or IPSASB. Please refer to the current exposure draft section on the XRB website for more details (www.xrb.govt.nz).
Comments due to NZASB by
Comments due to IASB by
Comments due to IPSASB by
12 May 2015
10 June 2015
15 May 2015
15 May 2015
Events and webcasts
The Q2 2015 financial reporting update webcast is scheduled for 19 June 2015. EY panelists will discuss current FASB projects, financial reporting matters to consider in the second quarter and other financial reporting developments. Please register here.
The new revenue recognition standard: a closer look - A webcast series for IFRS preparers: session 1, 2 and 3 (Replay)
Register for three sessions of our webcast - The new revenue recognition standard: a closer look. The webcast series will include a detailed discussion and a variety of examples for each step of the new revenue recognition model by our panel of subject-matter professionals.
The first webcast in this series will cover the requirements of Step 1 and Step 2 of the new revenue recognition model, as well as the application guidance on warranties. Our panel will also discuss the transition requirements of the new standard. Please click here to watch.
The second webcast will cover the requirements of Step 3 and Step 4, as well as the guidance on capitalisation of costs to obtain and fulfil contract. Please click here to watch.
The third webcast will cover the requirements of Step 5, as well as the application guidance on licenses of intellectual property. Our panel will also discuss presentation and disclosure requirements, highlighting areas that may require significant amounts of data and/or judgments by management. Please click here to watch.
Archived recordings of all our previous webcasts are available here.
For more information on any of the points raised in this newsletter, please contact a member of EY’s Financial Accounting Advisory Services Team:
|Kimberley Crook – Partner, Auckland||+64 274 899 535|
|Graeme Bennett – Partner, Auckland||+64 274 899 943|
|David Pacey – Executive Director, Auckland||+64 212 425 716|
|Lara Truman – Executive Director, Wellington||+64 274 899 896|
|Alex Knyazev – Senior Manager, Auckland||+64 218 53 152|
|David Bassett – Senior Manager, Auckland||+64 274 899 883|
The information contained in this newsletter does not constitute advice and should not be relied upon as such. Professional advice should be sought prior to action being taken on any of the information.