The Australian Accounting Standards Board (AASB) and the New Zealand Financial Reporting Standards Board (FRSB) held a joint meeting from 30 to 31 July in Auckland.
Some of the key discussions included:
Revenue from non-exchange transactions
The boards agreed to develop an exposure draft on revenue from non-exchange transactions mainly based on IPSAS 23 Revenue from non-exchange transactions (taxes and transfers).
The boards' project teams will develop guidance and clarify when a transfer arrangement becomes binding.
It was also considered that the revenue recognition project being progressed jointly by the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board, including developments in the treatment of revenue from exchange transactions, may have implications on the treatment of revenue from non-exchange transactions.
Service concession arrangements: grantor accounting
The AASB issued an invitation to comment ITC 16 request for comment on the International Public Sector Accounting Standards Board's (IPSASB's) consultation paper Accounting and financial reporting for service concession arrangements in April 2008.
Submissions have been now received and considered.
AASB members were concerned with some aspects of the IPSASB proposals, mainly relating to the treatment of residual interests. Based on the Australian experience, there are examples of service concessions arrangements with no residual values.
The IPSASB proposals appear to have a different view, although the boards encouraged IPSASB to continue with the project.
Modifying IFRS requirements for not-for-profit entities
The boards agreed there will be differences in not-for-profit entities to justify a modification of IFRS for the sector. A range of factors that should be considered was also agreed upon, which will be articulated in the draft policy paper to be considered at the September meetings.
The conceptual framework
Various issues relating to the development of the IASB's proposed framework (currently being exposed by the AASB as ED 164 and ITC 17) and related matters on the forthcoming consultation paper on the IPSASB's conceptual framework were also considered.
Emissions trading schemes
The boards noted that it is proposed that the Australian carbon pollution reduction scheme will commence in 2010.
The Australian scheme will be similar to that in New Zealand, but the pricing and trading mechanisms of carbon allowance permits are likely to differ; however, the boards expect similar accounting may be applied.
The IASB should progress with the project on a timely basis; however, if the project does not progress in accordance with the IASB's current timetable, the boards will have to consider other available processes.
Project staff will develop a paper outlining possible processes.
The boards also noted that the International Auditing and Assurance Standards Board has included carbon emissions in its current work plan.
IASB update
Warren McGregor, IASB member, provided an overview on the IASB's current activities. The technical focus includes its response to the credit crisis and the resulting emphasis on:
- consolidations and special purpose entities
- the establishment of an expert advisory group on the valuation of financial instruments in an illiquid market
Other projects include de-recognition of assets, leases and related parties.
The boards were advised that the Asian standard-setters are considering the development of an Asia-Pacific standard setters group to discuss accounting issues and also to more efficiently engage with the IASB.
IASB SAC report
Judith Downes, Standards Advisory Council (SAC) member, provided an update on SAC's activities.
The boards were advised there will be changes in the composition of SAC, including appointments as representatives of organisations and not in personal capacities.
IPSASB report
Mike Hathorn, IPSASB chair, informed the boards that IPSASB has established a liaison committee with the IASB to cooperate on various technical projects including grants, not-for-profit, and interaction on conceptual framework projects.
Further joint work can be expected, subject to the review of the constitution.
Further information
