IASB November 2008
In drafting the consolidation exposure draft to be published by the Board before the end of the year, the staff identified seven issues for Board discussion. The Board tentatively decided that:
- the general guidance on control with less than half the voting rights should apply to options and convertible instruments.
- when a reporting entity holds voting rights both directly and as an agent for other parties, and it is difficult to identify whether the entity uses the voting rights of the other parties for its own benefit or for the benefit of those other parties, the reporting entity should exclude the voting rights it holds as an agent only if the reporting entity:
(a) can demonstrate that it is obliged to act in the best interests of those other parties, and
(b) has policies and procedures in place that ensure the independence of the decision making in its role as an agent from that as a holder of voting rights directly.
- a reporting entity should assess power over a structured entity if it obtains returns that are potentially significant and are more than those received by any other party.
- a reporting entity should disclose information to help users evaluate the extent of the group’s activities that are attributable to non-controlling interests, and information about restrictions that are a consequence of assets and liabilities being held by subsidiaries.
- the accounting and disclosure requirements for separate financial statements would be retained in IAS 27.
- entities should apply the new IFRS on consolidated financial statements prospectively.
- the comment deadline for the exposure draft will be 20 March 2009.
Location: London UK
Date: 21/11/2008
Observer Notes