NZASB Update 7/2020

COVID-19: IASB and NZASB extend the comment period for two consultation documents

Applies to: For-profit

As part of its response to the COVID-19 pandemic, the IASB has decided to extend the consultation period of the Exposure Draft (ED) General Presentation and Disclosures and the Discussion Paper (DP) Business Combinations—Disclosures, Goodwill and Impairment.

Consequently, the NZASB has also extended its consultation period for New Zealand constituents.

IASB ED on accounting for rent concessions granted due to the COVID-19 pandemic

Applies to: For-profit

The IASB has published an ED proposing to amend IFRS 16 Leases, to make it easier for lessees to account for rent concessions granted as a result of the COVID-19 pandemic, such as rent holidays and temporary rent reductions.  

The proposed amendment would exempt lessees from having to consider whether particular rent concessions granted as a result of the COVID-19 pandemic are lease modifications, allowing them to account for these changes as if they were not lease modifications. 

The IASB has responded quickly to provide support to stakeholders at this difficult time with a short 14-day comment period.

Due to the short comment period, we encourage Tier 1 and Tier 2 for-profit entities to comment on this ED directly to the IASB (with a copy to the NZASB).

Comments are due to the IASB by 8 May 2020. 

Have a look

IASB ED: Interest Rate Benchmark Reform – Phase 2

Applies to: For-profit

The IASB has recently issued for comment ED/2020/1 Interest Rate Benchmark Reform – Phase 2. 

This ED is the second phase of the IASB’s priority project on the effects of interest rate benchmark reform on an entity’s financial statements that arise when interest rate benchmarks are replaced with alternative benchmark rates.   

Interest rate benchmarks such as interbank offer rates (IBORs) play an important role in global financial markets. The Financial Stability Board has published a report setting out recommendations to reform such benchmarks.

These proposed amendments aim to address issues affecting financial statements when changes are made to contractual cash flows and hedging relationships as a result of the reform. 

We encourage Tier 1 and Tier 2 for-profit entities to comment on this ED directly to the IASB (with a copy to the NZASB).

Have a look 

Comments are due to the IASB by 25 May 2020. 

Upcoming NZASB Meeting

7 May 2020  

Applies to: For-profitNot-for-profitPublic Sector

The NZASB will consider:

• two possible options for relief from PBE FRS 48 Service Performance Reporting in response to COVID-19;
• proposals in the three IPSASB Revenue and Transfer Expenses EDs;
• a draft Request for Information for the Post-implementation Review of Tier 3 and Tier 4 PBEs;
• proposals in the IASB Discussion Paper Business Combinations — Disclosures, Goodwill and Impairment; and
• the approach for determining Tier 2 for-profit entity disclosures in the future. 

You can access the public agenda and public meeting papers and register to attend the May meeting on our website. 

Have a look

IPSASB: EDs on Revenue and Transfer Expenses

Extension of comment period

In response to the COVID-19 pandemic, the IPSASB has extended the comment period closing date for ED 70 Revenue with Performance Obligations, ED 71 Revenue without Performance Obligations and ED 72 Transfer Expenses from 15 September 2020 to 1 November 2020.  In response to this, the NZASB has extended its comment period to 23 September 2020.

The IPSASB acknowledged that the extension responds to the additional challenges facing stakeholders as a result of the COVID-19 pandemic and will give them additional time to undertake outreach and prepare their responses. 

Have a look

IPSASB Webinars available

In February 2020 the IPSASB published three related EDs, two dealing with revenue and one dealing with transfer expenses. The IPSASB has also developed three webcasts outlining the proposals in each ED and a further one explaining the links between the EDs. The three EDs introduce new approaches for both revenue and transfer expense recognition.  

Further details on the proposals

Have your say…

Before issuing a finalised accounting standard the NZASB and the international standard-setting boards, the IASB and the IPSASB, issue consultation documents. These documents seek your feedback on proposals that could potentially affect you.

We are currently consulting on the matters set out in the table below. 

Tell us how these changes could affect your entity or the entities you work with.

We welcome your comments and feedback, either formal or informal, by the due dates below.

You can submit your comments directly from the Exposure Draft pages on our website following the links below.

IASB Consultation Documents

IPSASB Consultation Documents

There are no current domestic consultations.