The FASB and IASB recently met in London and discussed a variety of topics, with the primary focus being on the direction for new requirements for the impairment of those financial assets that are measured at amortized cost, leases and effective dates and transition for their four major projects (financial instruments, insurance, leases and revenue recognition).
The FASB’s position is that early adoption of standards relative to the four major projects should generally not be permitted. Not surprisingly, the IASB is in favor of allowing early adoption of new standards by first-time adopters of IFRS. For entities currently reporting in accordance with IFRS, decisions will be made on a standard-by-standard basis.
The Boards also decided to re-expose their revised lease accounting proposals. There have been significant changes to the original exposure draft issued in August 2010. By re-exposing the draft, interested parties will have an opportunity to comment on the changes that have taken place.
The Boards also tentatively agreed on an effective date for the revenue recognition standards. The Boards noted that the new standard likely would not be effective earlier than annual periods beginning on or after January 1, 2015. The International Accounting Standards Board (IASB) and the US-based Financial Accounting Standards Board (FASB) have recently agreed to re-expose their revised proposals for a common revenue recognition standard.
The FASB and IASB are scheduled to meet again in September 2011.
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