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IFRS Foundation response to covid-19

The IFRS Foundation shares global concerns about the impact of covid-19 and is monitoring developments guided by statements from public health authorities. The covid-19 pandemic represents an unprecedented global crisis, affecting not only our collective health and wellbeing, but the global economy. We are acting to support stakeholders during these difficult times by:

  • supporting consistent application of requirements in IFRS Standards; and
  • updating our work plan with new project timelines.

You can find further information about the coronavirus and the Foundation's work here.

Supporting consistent application of requirements in IFRS Standards

Heightened economic uncertainty arising from the covid-19 pandemic can raise questions regarding the application of IFRS Standards. The IFRS Interpretations Committee is, as always, available to support the understanding and consistent application of the Standards.

In response to queries about the work of the Board and about covid-19, we have prepared educational materials highlighting:

In addition, the Board has issued an amendment to IFRS 16 Leases to make it easier for lessees to account for covid-19-related rent concessions such as rent holidays and temporary rent reductions.

Updating our work plan with new project timelines

On 17 April 2020, the Board decided to extend the comment deadline for several consultations and to delay the publication of other planned consultation documents.

New project timelines

Open for comment documents

Project NEW comment period deadline Previous comment period deadline
Exposure Draft: General Presentation and Disclosures (Primary Financial Statements) 30 September 2020 30 June 2020
Request for Information: Comprehensive Review of the IFRS for SMEs Standard 27 October 2020 27 July 2020
Discussion Paper: Business Combinations—Disclosures, Goodwill and Impairment 31 December 2020  15 September 2020

Forthcoming major consultations

Project Consultation document New expected publication date Previous expected publication date
Business Combinations under Common Controls Discussion Paper September 2020 June 2020 
Rate-regulated Activities Exposure Draft October 2020 August 2020
Post-implementation Review of IFRS 10, IFRS 11 and IFRS 12 Request for Information December 2020 August 2020
2020 Agenda Consultation Request for Information March 2021 September 2020
Disclosure Initiative—Targeted Standards-level Review of Disclosures Exposure Draft March 2021 September 2020
Management Commentary Exposure Draft December 2020 December 2020

The Board's updated work plan can be accessed here.

We need your views

To continue our investor engagement efforts, we have replaced regular meetings with virtual meetings where possible. We are currently engaging with investors on two of the published consultations.

Goodwill and Impairment

The Board is seeking feedback on the accounting for Business Combinations, in particular, on disclosures, goodwill and impairment. The Board published a discussion paper in March 2020 which discusses whether the Board can improve the usefulness of information companies provide about the business they acquire.

The Discussion Paper looks at how companies can provide investors with information on the subsequent performance of acquisitions and will also consider the often-debated topic of whether the Board should reintroduce amortisation of goodwill.

An overview of the Discussion Paper can be found in this Snapshot.

Investors’ views on these topics will be critical in the Board’s deliberations of the next steps to take on this project, and whether to develop an exposure draft containing any of the proposals discussed in the Discussion Paper. The Board is asking for stakeholder comments by 31 December 2020.

Primary Financial Statements

The Board has proposed improvements to the way information is communicated in the financial statements, with a focus on financial performance. Responding to investor demand, the proposals would require more comparable information in the statement of profit or loss and a more disciplined and transparent approach to the reporting of management-defined performance measures, which are also known as ‘non-GAAP’ measures.

The proposals would result in a new IFRS Standard that sets out general presentation and disclosure requirements relevant for all companies, replacing IAS 1 Presentation of Financial Statements. The Board is also proposing to amend some other IFRS Standards.

A brief overview of the proposals can be found in this Snapshot.

To read and comment on the General Presentation and Disclosures Exposure Draft and the accompanying Basis for Conclusions and Illustrative Examples, please go to the comment letter page. The Board is asking for stakeholder comments by 30 September 2020.

Stay up to date

IFRS Foundation Conferences in 2020

Given the ongoing public health emergency related to covid-19, the IFRS Foundation has decided to postpone its June 2020 Annual IFRS Foundation Conference.

Instead we will hold a virtual conference on 28–29 September 2020. Further information will be available soon.

IOSCO encourages issuers’ fair disclosure about covid-19 related impacts

The Board of the International Organization of Securities Commissions (IOSCO) issued a public statement highlighting the importance to investors and other stakeholders of having timely and high quality information about the impact of covid-19 on issuers' operating performance, financial position and prospects.

Supply Chain Financing Arrangements-Reverse Factoring

In January 2020 Moody’s Investors Service submitted a letter to the IFRS Interpretations Committee (Committee) about Reverse Factoring (aka Supply Chain Finance); the request asked in particular about the presentation and disclosure of liabilities associated with reverse factoring arrangements. In April 2020, the Committee met to discuss the staff’s research on these arrangements (the IFRS research paper and Moody’s letter are available here). The next step will be for the Committee to consider whether standard-setting is necessary to address the matter in the submission at its June 2020 meeting, and our staff are also available to speak with investment professionals about their views.

IFRS 17 Insurance Contracts—why annual cohorts?

The requirement to use annual cohorts as part of the process of accounting for insurance contracts has been the cause of much debate since IFRS 17 was issued in May 2017. Board Chair Hans Hoogervorst explains the reasons for the Board's decision to retain unchanged the annual cohort requirement.

Amendments to aid companies implementing IFRS 17 Insurance Contracts

The Board has completed its discussions of the matters raised on IFRS 17. It has confirmed most of the amendments to IFRS 17 that were proposed for public consultation in June 2019, with some minor modifications in response to the feedback from the consultation.

The amendments are intended to support implementation of IFRS 17 by reducing the costs for companies and making it easier for them to explain their results when they apply the new requirements for insurance contracts. The amendments do not change the fundamental principles of IFRS 17 or the improvements in transparency and comparability it will introduce.

The Board is currently finalising the amendments and expects to issue them as planned towards the end of June 2020.

Companies will be required to apply IFRS 17 (incorporating the amendments) from 1 January 2023. This should allow sufficient time for an orderly introduction of the amended IFRS 17 into the various legal systems and enable insurance companies around the world to implement the new requirements at the same time, which the Board considers to be beneficial for investors.

Sustainability reporting and its relevance to the IFRS Foundation

IFRS Foundation Trustee Teresa Ko provided prepared remarks at the inaugural meeting of the Green and Sustainable Finance Cross-Agency Steering Group earlier in May. The group was established by the Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) to coordinate the management of climate and environmental risks to the financial sector in Hong Kong. In her remarks, she outlines possible future roles the IFRS Foundation could play in supporting progress towards the development of high-quality, internationally recognised standards for sustainability reporting.

Resources for investors

IFRS Standards and climate-related disclosures

Board Member Nick Anderson explains how requirements within IFRS Standards relate to climate change risks and other emerging risks.

Investor Perspectives: Amendments to IFRS 17 make it easier for insurers to explain results

Board Member Nick Anderson discusses the new disclosures the Board proposed as part of the package of proposed amendments to IFRS 17 that were published in June.

Working towards better information on business combinations

In this article, Board Member Tom Scott discusses the Board's preliminary views on how companies can provide users of financial statements with better information about mergers and acquisitions at a reasonable cost.Board Member 

How to get in contact with us in this difficult time

contact us

The IFRS Foundation is working to ensure the safety and wellbeing of its staff. It decided to close its London office and all staff have been working from home since 16 March 2020.

We use the technology effectively to:

support remote working;

promote our commitment to transparency and due process—meetings are still observable publicly; and

continue to communicate with our stakeholders.

Board members and staff are working from home and can be reached via email or phone as usual. If you would like to get in touch, please email your regular contact person or call the switchboard (+44 (0)20 7246 6410) and we will connect you to the person who can best serve you.