Tuesday 10 December 2013
The objective of the proposed interim IFRS is to enhance the comparability of financial reporting by entities with rate-regulated activities until guidance is developed through the research project on rate regulation.
The requirements of some national accounting standard-setting bodies permit or require entities that are subject to certain types of rate regulation to capitalise and defer expenditures (or income) that would otherwise be recognised as expenses (or income) in the statement of profit or loss and other comprehensive income by non-rate-regulated entities. These amounts are often referred to as 'regulatory deferral' (or 'variance') accounts. There is currently no Standard in IFRS that specifically addresses the accounting for rate-regulated activities.
The IASB recognises that discontinuing the recognition of regulatory deferral account balances before the completion of the comprehensive Rate-regulated Activities research project could be a significant barrier to the adoption of IFRS for those entities for which regulatory deferral account balances represent a significant proportion of net assets. The IASB is, therefore, proposing to allow those entities that currently recognise regulatory deferral account balances in accordance with their current GAAP to continue to do so when making the transition to IFRS.
IASB announces membership of Consultative Group for rate regulation
IASB issues proposals for an interim Standard on rate regulation
The IASB invites nominations for membership of a consultative group on Rate-regulated Activities
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