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IASB meeting summaries


 IASB April 2008


 

In their joint project on business combinations, the Board and the FASB decided that non-current assets held for sale should be measured at fair value, rather than at fair value less costs to sell. However, the IASB noted that it should provide an opportunity for constituents to comment on this decision and in IFRS 3 Business Combinations (as revised in 2008) the Board allowed a temporary exception to the measurement principle of fair value for non-current assets held for sale until IFRS 5 was amended.

At this meeting, the Board decided not to amend IFRS 5 on this point. Accordingly, the exception to the measurement principle of fair value related to non-current assets held for sale in IFRS 3 (revised 2008) will remain in force.

Discontinued operations

In their joint project on financial statement presentation, the boards decided to develop a common definition of discontinued operations based on operating segments as defined in their standards on segment reporting and to require common disclosures related to components of an entity that have been disposed of.

At this meeting, the Board tentatively decided:

  • to define discontinued operations as �a component of an entity that has been (or will be) disposed of and meets the definition of an operating segment under IFRS 8 Operating Segments�. The amounts presented in the statement of comprehensive income and related note disclosures should be based on applicable IFRSs rather than the amounts provided to the chief operating decision maker.
  • to require disclosure of the following items for all components of an entity that have been (or will be) disposed of, except for subsidiaries acquired and held exclusively with a view to resale:

(a) the major classes of revenues and expenses, including impairments, interest, depreciation and amortisation;

(b) the major classes of cash flows (operating, investing and financing);

(c) the major classes of assets and liabilities; and

(d) the nature of the activities disposed of and the use of the proceeds from those activities.

  • that the amounts disclosed should be based on applicable IFRSs.
  • to allow early application of the proposed amendments. The proposed amendments to IFRS 5 will be applied prospectively from a date to be determined when the amendments are finalised, with one exception: the amounts in the statement of comprehensive income should be restated on the basis of the revised definition of discontinued operations for all periods presented. If an entity reclassifies its amounts presented in prior periods, it should disclose that fact and the amounts reclassified.

The Board instructed the staff to prepare, on the basis of these decisions, a pre-ballot draft of an exposure draft to amend IFRS 5. The comment period will be 120 days.

Date: 4/16/2008