IFRS
The International Accounting Standards Board (IASB) has proposed a new comprehensive standard to give investors more transparent and comparable information about companies’ financial performance. IFRS 18, Presentation and Disclosure in Financial Statements, introduces three defined categories for income and expenses – operating, investing and financing – and requires companies to provide defined subtotals, including operating profit, to aid comparisons. Companies must also explain how they calculate company-specific alternative performance measures issued alongside balance sheets and have them audited. IFRS 18 also advises on organising information to ensure it is neither too detailed nor summarised, and will demand more transparency about operating expenses. It will replace IAS 1, Presentation of Financial Statements.
Sustainability
The US Securities and Exchange Commission (SEC) has stayed its new rule on enhancing and standardising climate-related disclosures by US-listed companies and those undergoing public offerings after it was challenged in the courts. Republican-led states, energy companies and the US Chamber of Commerce have claimed the rule exceeds the SEC’s powers. Environmentalists have also launched claims arguing the rules are too weak, by eschewing value chain emissions reporting. The SEC has said it will ‘vigorously defend’ the rule in the judicial review that will determine its fate.
The International Sustainability Standards Board (ISSB) has reported that Canada, Japan and Singapore are now consulting on whether to base their sustainability-related disclosure rules on ISSB standards, following recently completed consultation exercises by Australia and Malaysia. The ISSB adds that Brazil, Costa Rica, Sri Lanka, Nigeria and Türkiye have decided to adopt or use ISSB standards in their sustainability reporting regimes.
The International Federation of Accountants (IFAC) has released guidance for accountants to better prepare themselves for the upcoming increase in sustainability reporting. The document, Equipping Professional Accountants for Sustainability: What’s New and What Hasn’t Changed, advises on business acumen, behavioural competence, ethics and professional values, and closing gaps between known and needed technical expertise.
Ethics
The International Ethics Standards Board for Accountants (IESBA) has announced global standards on ethics in tax planning and related services to advise accountants on how to deal with tax authorities and clients and comply with tax laws. It says tax planners should ‘ensure due consideration of public interest as well as potential reputational, commercial and wider economic consequences for their clients or employing organisations’.
IESBA has also released a strategy and work plan for 2024–27, which will include expanding guidance to other financial and reporting professionals, such as sustainability assurance practitioners. It will also explore ethical considerations on the role of CFOs and other senior professional accountants in businesses, along with relationships between firms and audit clients.
Public sector
The International Public Sector Accounting Standards Board (IPSASB) is consulting on its exposure draft 88, Arrangements Conveying Rights over Assets, which will amend IPSAS 47 on revenue and IPSAS 48 on transfer expenses. The draft proposes illustrative examples to accompany IPSAS 47 and 48 on reporting assets common in the public sector.
IFAC has released training materials to help governments and their agencies report finances under the accrual-based International Public Sector Accounting Standards (IPSAS). Packaged into Implementing IPSAS: A Guide for Trainers, the materials will assist in training officials and accountants in these reporting standards and how to apply them.
SMEs
The IASB has released proposed amendments to its planned third IFRS for SMEs accounting standard edition. The amendments focus on reporting exchangeability between two currencies and disclosure requirements for supplier finance arrangements.
Audit
The International Auditing and Assurance Standards Board (IAASB) has published a 2024–27 strategy and work plan aimed at enhancing the consistency and quality of audit and assurance standards worldwide. Its objectives include completing priority audit and assurance projects, focusing on fraud, going concern and sustainability assurance. IAASB also plans to adopt and implement a major standard for sustainability assurance engagements, along with standards on audit evidence and risk response, materiality and reviews of interim financial information.
More information
Visit ACCA’s Accounting for a better world hub for articles and resources on sustainable business, and read ACCA’s guide to preparing for sustainability reporting.
