IASB mulls changes in group accounting

The International Accounting Standards Board is looking into the standards for consolidated financial statements, or group accounting.

The IASB circulated a request for information Wednesday as part of a post-implementation review of three of its International Financial Reporting Standards for group accounting: IFRS 10, "Consolidated Financial Statements," IFRS 11, "Joint Arrangements," and IFRS 12, "Disclosure of Interests in Other Entities."

The IASB, like the Financial Accounting Standards Board in the U.S., carries out post-implementation reviews of existing standards to see how companies have adjusted to them and how well they have worked over time. In the U.S., FASB’s new chairman, Richard Jones, is placing greater emphasis on the PIR process after FASB recently inherited the job of doing such reviews from its parent organization, the Financial Accounting Foundation, which had been conducting them in the past.

For international standards, the IASB recently revamped its review process as well, and in August released a newly revised due process handbook for performing them. IFRS 10 provides requirements for the preparation of group, or consolidated, financial statements. IFRS 11 deals with how to account for interests in joint arrangements. IFRS 12 spells out the information that needs to be disclosed in the notes to the financial statements about interests in other companies. The IFRS standards have been in effect for annual reporting periods since 2013.

Courtesy of IFRS Foundation

“Post-implementation reviews are an opportunity to check that our standards do the job they were intended to do. I encourage all stakeholders to help us in the process by providing relevant feedback,” said IASB Chairman Hans Hoogervorst in a statement.