IASB published a summary of its October meeting. The discussions covered key topics such as amendments to the insurance contracts standard, impact of interest rate benchmark (IBOR) reform on financial reporting, review of IFRS for small and medium enterprises (SMEs) standard, and certain issues on financial instruments with characteristics of equity.
With respect to the IFRS 17 on insurance contracts, the Board received a summary of the feedback from outreach on the Exposure Draft on amendments to IFRS 17. At the November 2019 meeting, the staff plans to provide the Board with a summary of feedback from comment letters on the Exposure Draft and a plan for redeliberating topics. The Board’s objective remains to issue any amendments to IFRS 17 in mid-2020. Additionally, the Board discussed and took decisions on potential IBOR reform-related accounting issues with respect to the classification and measurement of financial instruments, specifically:
- The assessment of whether a change in the contractual cash flows or terms of a financial instrument is a substantial modification and the accounting requirements for modifications that are not substantial (that is, modifications that do not result in the derecognition of a financial instrument when IFRS 9 on financial instruments is applied)
- Modifications that result in the derecognition of existing financial instruments and the accounting implications of recognizing modified financial instruments as new financial instruments
The Board also discussed its plan to consult stakeholders on the core elements of the Dynamic Risk Management accounting model. After that consultation, the Board will decide how best to pursue the next phase of the project. Also discussed was the 2019 Comprehensive Review of the IFRS for SMEs standard.
Keywords: International, Accounting, Banking, Insurance, Securities, IBOR, IFRS 9, Financial Instruments, Interest Rate Benchmark, IFRS 17, Insurance Contracts, IFRS for SMEs, IASB
Previous ArticleMNB Publishes Fintech Strategy
PRA, via the consultation paper CP12/20, proposed changes to its rules, supervisory statements, and statements of policy to implement certain elements of the Capital Requirements Directive (CRD5).
EIOPA published the financial stability report that provides detailed quantitative and qualitative assessment of the key risks identified for the insurance and occupational pensions sectors in the European Economic Area.
EBA published its risk dashboard for the first quarter of 2020 together with the results of the risk assessment questionnaire.
EBA announced that the next stress testing exercise is expected to be launched at the end of January 2021 and its results are to be published at the end of July 2021.
PRA published the consultation paper CP11/20 that sets out its expectations and guidance related to auditors’ work on the matching adjustment under Solvency II.
MAS published a statement guidance on dividend distribution by banks.
APRA updated its capital management guidance for banks, particularly easing restrictions around paying dividends as institutions continue to manage the disruption caused by COVID-19 pandemic.
FSB published a report that reviews the progress on data collection for macro-prudential analysis and the availability and use of macro-prudential tools in Germany.
EBA issued a statement reminding financial institutions that the transition period between EU and UK will expire on December 31, 2020; this will end the possibility for the UK-based financial institutions to offer financial services to EU customers on a cross-border basis via passporting.
SRB published guidance on operational continuity in resolution and financial market infrastructure (FMI) contingency plans.