Financial reporting update: IFRS 17 in Parliament, IASB update, and more
IFRS 17 debate in Parliament
European Parliament is set to debate a resolution on the upcoming insurance contracts standard known as IFRS 17. The standard is designed to bring a harmonisation of the accounting rules for insurance contracts across different constituencies and is intended to provide a more realistic description and better comparability of financial statements within the insurance sector.
A Parliament document notes that the benefits of more consistency and transparency come at the price of a fundamental accounting change, entailing "considerable and significant" efforts and costs. The document also notes the potential for "complexity and administrative burden" for companies. The standard is scheduled to take effect on 1 January 2021.
International Accounting Standards Board update
The International Accounting Standards Board (IASB) has added a maintenance project, Lease Incentives (Amendments to IFRS 16 Illustrative Examples), to its work plan. In advance of the IASB's 19 June meeting, no milestone or expected dates of publication have been determined. Additionally, a research project looking at goodwill and impairment has been delayed with no new date for an exposure draft or discussion paper. A list of IASB activity can be found on the projects website.
Technology offers opportunities, report says
Eighty-four per cent of respondents in an Accountancy Europe report said they were using more technology than a year ago. The report, distributed in May, also found that more respondents, compared with the previous year, felt technology presented an opportunity to reinvent the profession and improve services. However, a slightly higher percentage (44% vs. 42% the previous year) considered technology's impact a serious challenge requiring significant changes.
A guide for the Business Model Framework
The Association of International Certified Professional Accountants has published a guide to the CGMA Business Model Framework. The guide explains how to apply the framework to understanding your business and making important strategic decisions on future investment. The guide is based on a worldwide consultation with leading practitioners and academics in the management accounting sector.
— David Hackett is technical policy manager at the Association of International Certified Professional Accountants. To comment on this article or to suggest an idea for another article, contact Neil Amato, an FM magazine senior editor, at Neil.Amato@aicpa-cima.com.