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European Commission requires electronic tagging of financial statements using the IFRS Taxonomy

The European Commission has announced on June 4, 2019 that listed companies that prepare consolidated financial statements using IFRS Standards will be required to tag their primary financial statements using the IFRS Taxonomy for financial years starting on or after 1 January 2020. The requirement is part of the European Commission’s move to the European Single Electronic Format, an electronic format for EU annual financial reports introduced to support accessibility and transparency of financial information.

For more please see https://www.ifrs.org/news-and-events/2019/06/european-commission-requires-electronic-tagging-of-financial-statements-using-the-ifrs-taxonomy/

IASB proposes to update Conceptual Framework reference in IFRS 3

On May 30, 2019 the IASB (Board) has published for public consultation proposed narrow-scope amendments to IFRS 3 Business CombinationsThe amendments would update a reference to the Conceptual Framework for Financial Reporting without changing the accounting requirements for business combinations.

IFRS 3 specifies how a company should account for the assets and liabilities it acquires when it obtains control of a business. It refers companies to the Board’s Conceptual Framework to determine what constitutes an asset or a liability.

IFRS 3 refers to an old version of the Conceptual Framework. The Board proposes to update IFRS 3 so it refers instead to the latest version, issued in March 2018.

Updating the reference without making any other changes to IFRS 3 could change the accounting requirements for business combinations because the liability definition in the 2018 Conceptual Framework is broader than that in previous versions. Companies would need to record provisions and contingent liabilities when they acquire a business they would not record in other circumstances. To avoid this, the Board also proposes that for provisions and contingent liabilities, companies refer to IAS 37 Provisions, Contingent Liabilities and Contingent Assets instead of the Conceptual Framework to determine what constitutes a liability.

This change is proposed to stand until the Board decides whether and how to amend IAS 37 to align it with the 2018 Conceptual Framework.

Accounting and Auditing Board of Ethiopia (AABE) encourage you to read the consultation paper and provide your comments on the proposals.

AABE is committed to adopting quality international standards. Generally, once a standard has been issued by IASB, AABE then issues the standard for reporting entities under its jurisdiction. Issues of concern by Ethiopian Stakeholder can be taken into accounts through actively involving in commenting on Consultation Papers and Exposure Drafts. Moreover, you will keep informed yourselves through reading with the new updates of international standards.

Therefore, this is opportunity to comment on the proposed future standard to be issued by IASB and to be adopted by AABE.

You can access the exposure draft Document

https://www.ifrs.org/-/media/project/updating-a-reference-to-the-conceptual-framework-amendments-to-ifrs-3/exposure-draft/exposure-draft-reference-to-the-conceptual-framework-ifrs-3.pdf?la=en

If you are familiar with Ethiopian specific matters, send your comments – both formal and informal – by 10 September 2019 to AABE address as follows:

Postal address:

Accounting and Financial Reporting Directorate

Accounting and Auditing Board of Ethiopia

P.O. Box 80263

6 kilo Madagascar Street

Addis Ababa, Ethiopia

Email: infoaabe20@gmail.com

AABE also encourage you to send comments directly to the IASB, by 27 September 2019 and we will be glad if you send us the copy.

You can email your comments to the IASB commentletters@ifrs.org or electronically using ‘comment on a proposal’ page on the http://www.ifrs.org/open-to-comment/Pages/International-Accounting-Standards-Board-Open-to-Comment.aspx .  For your information you need to register as an eIFRS basic subscriber to submit comment.

Note

  • AABE would appreciate receiving a copy of your comment in Microsoft word format if electronically
  • Please do not forget to provide on behalf of whom you are commenting
  • AABE publish all comments it receive on its website (unless the comments are damaging the good reputation of anyone or the commenter request not to). You are encouraged to specify part of your comment that you would like to withhold from being publicized.