The International Accounting Standards Board has settled on its future agenda and priorities following a public consultation.
In a “feedback statement” outlining the input it received from the public, the IASB said Tuesday it heard five broad themes emerging from the more than 240 comment letters it received in response to a consultation document it issued in July 2011.
First, respondents asked that a decade of almost continuous change in financial reporting should be followed by a period of relative calm. Second, there was almost unanimous support for the IASB to prioritize work on the Conceptual Framework, which would provide a consistent and practical basis for standard setting.
Third, the IASB was asked to make some targeted improvements in response to the needs of new adopters of IFRS. Fourth, the IASB was asked to pay greater attention to the implementation and maintenance of the standards. Finally, the IASB was asked to improve the way in which the IASB develops new standards, by conducting more rigorous cost-benefit analysis and problem definition earlier on in the standard-setting process.
“Today we set out a new set of priorities, a new way of developing our standards, and new methods to deepen cooperation with the global standard-setting community,” said IASB chairman Hans Hoogervorst. “I would like to thank the thousands of people who have provided thoughtful responses to this public consultation. This is indeed a new chapter in the history of the IASB and our work to establish IFRS as the global language of financial reporting.”
The IASB also listed a number of priority research projects, including emissions-trading schemes, business combinations under common control, discount rates, the equity method of accounting, intangible assets, extractive activities, research and development activities, financial instruments with the characteristics of equity, foreign currency translation, non-financial liabilities, and financial reporting in high inflationary economies.
However, some projects appear to be off the agenda for now. The IASB noted that it and the U.S. Financial Accounting Standards Board did not succeed in developing a converged simplified standard on income taxes. The report noted that “a fundamental review of income tax accounting would be a significant project.”
As for the major convergence projects on financial instruments, revenue recognition and leasing that remain from its decade-old memorandum of understanding with FASB, the IASB said it would continue to give them high priority, along with the insurance contracts project that they have been working on since 2008.
As for new projects, the IASB said it had heard about several other areas from respondents that it was asked to address, but not to treat as a priority. Among them, the first three projects that the IASB plans to consider are agriculture, particularly bearer biological assets; rate-regulated activities; and the use of the equity method in separate financial statements.