This comment letter, which reflects the views of the international BDO network of independent member firms, was sent by BDO IFR Advisory Limited to the International Accounting Standards Board on 6 January 2012.
A copy of the exposure draft is attached at the foot of this page.
International Accounting Standards Board
30 Cannon Street
London
EC4M 6XH |
5 January 2012
Dear Sir
Exposure Draft ED/2011/05: Government Loans – Proposed amendments to IFRS 1
We are pleased to comment on the above exposure draft (the ED). Following consultation, this letter represents the views of the BDO network 1.
We agree with the Board’s proposal to grant first-time adopters of IFRS the same transitional relief provided to existing users of IFRS, that was incorporated into IAS 20 in 2008. This is because the rationale for providing existing users of IFRS with relief from restatement applies equally to first-time adopters. We also agree that a first-time adopter should be permitted to apply the requirements of paragraph 10A of IAS 20 retrospectively if the necessary information was obtained at the time of initially accounting for the loan.
We suggest that text is added to Paragraph B10 of the proposal, to clarify that it is the measurement requirements of IFRS 9 on initial recognition that are relevant:
‘...a first-time adopter shall apply the requirements in IFRS 9 Financial Instruments that relate to measurement on initial recognition and paragraph 10A...’
We hope that you will find our comments and observations helpful. If you would like to discuss any of them, please contact Andrew Buchanan at +44 (0)20 7893 3300.
Yours faithfully
Andrew Buchanan
Global Head of IFRS
BDO IFR Advisory Limited
1 Service provision within the international BDO network of independent member firms (‘the BDO network’) in connection with IFRS (comprising International Financial Reporting Standards, International Accounting Standards, and Interpretations developed by the IFRS Interpretations Committee and the former Standing Interpretations Committee), and other documents, as issued by the International Accounting Standards Board is provided by BDO IFR Advisory Limited, a UK registered company limited by guarantee. Service provision within the BDO network is coordinated by Brussels Worldwide Services BVBA, a limited liability company incorporated in Belgium with its statutory seat in Brussels. Each of BDO International Limited (the governing entity of the BDO network), Brussels Worldwide Services BVBA, BDO IFR Advisory Limited and the member firms is a separate legal entity and has no liability for another such entity’s acts or omissions. Nothing in the arrangements or rules of the BDO network shall constitute or imply an agency relationship or a partnership between BDO International Limited, Brussels Worldwide Services BVBA,
BDO IFR Advisory Limited and/or the member firms of the BDO network.
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