The Future of Financial Reporting€¦ · New IFRS Standards 6 Standard Big change Effective date...
Transcript of The Future of Financial Reporting€¦ · New IFRS Standards 6 Standard Big change Effective date...
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The views expressed in this presentation are those of the presenter, not necessarily those of the
International Accounting Standards Board or IFRS Foundation.
Copyright © 2017 IFRS Foundation. All rights reserved
IFRS® Foundation
The Future of Financial Reporting
Hans Hoogervorst
Chairman, International Accounting Standards Board
October 2017
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2IFRS Foundation
• Headquartered in London, UK
• Regional Asia-Oceania office in Tokyo, Japan
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3International organisation
150staff
30nationalities
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4Adoption of IFRS Standards
= IFRS Standards required
126 of 150 jurisdictions
require IFRS Standards
for all or most publicly
accountable companies
84%
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5
5IFRS Foundation
Recent developments
Copyright © IFRS Foundation. All rights reserved
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6New IFRS Standards
Standard Big change Effective date
IFRS 9 Financial Instruments Expected loss model replaces
incurred loss model
2018
IFRS 15 Revenue from
Contracts with Customers
Global Standard - IASB and
FASB converged
2018
IFRS 16 Leases All leases onto balance sheet 2019
IFRS 17 Insurance Contracts Truly international, current
measurement
2021
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7Supporting implementation / application
New
Standards
Existing
Standards
Transition Resource Groups
Webinars and other supporting materials
Conferences
IFRS Interpretations Committee
Agenda decisions
IFRIC Interpretations
Narrow-scope
amendments
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8
8IFRS Foundation
Today and the future
Copyright © IFRS Foundation. All rights reserved
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9Challenges to financial reporting
Gap between book
value and market valueDisclosure overload
Big data, artificial
intelligence Sustainability reporting
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10Keep calm and carry on
Financial reporting will
remain the main anchor for
investors
Big data and artificial
intelligence = supplement,
not replace
Period of calm needed
Improve what
we have
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11Priorities until 2021
Better Communication in Financial Reporting
Primary
Financial
Statements
Disclosure
Initiative
IFRS
Taxonomy
Content and its organisationContent
delivery
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12Disclosure Initiative
Enabling preparer
judgement
Improved disclosure
requirements
Improved disclosures &
better communication
• Disclosure problem:– Not enough relevant information
– Too much irrelevant information
– Poor communication
12
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13Making Materiality Judgements
‘One-stop materiality shop’
Practical guidance
Examples
All IFRS materiality requirements
+
+
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14Meaningful disclosures
• 6 case studies– Wesfarmers Ltd
• Before and after illustrations
• Show companies’ journeys
• Inspire others
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15Primary Financial Statements – scope
Statement(s) of
financial performance
Statement of
cash flows
Statement
of financial
position
Statement
of changes
in equity
Requiring additional
EBIT subtotal
Eliminating options
(interest/dividends)
No planned change –
except possible
development of template
for primary financial
statements and greater
disaggregation
Providing guidance on
presentation of
management operation
performance and
alternative EPS
Aligning the operating
section between the
statements of cash flows
and financial
performance
Better ways to
communicate OCI
Requiring a consistent
starting point for the
reconciliation
• Developing a template for primary financial statements
• Achieving greater disaggregation
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16Corporate reporting
Financial reporting
Mandatory
IFRS Standards
Integrated reporting Sustainability reporting
Non-mandatory
IFRS Management
Commentary
Practice Statement
(MCPS)
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17Keep up to date
www.ifrs.org
@IFRSFoundation
IFRS Foundation, IASB
IFRS Foundation
IFRS Foundation