Annual_Report2014

Annual Report 2014
Irish Auditing & Accounting Supervisory Authority
20
During 2014 ESMA published its final Guidelines on
enforcement of financial information, which came
into effect on 29 December 2014. The impact of
these guidelines on IAASA is detailed in the Chief
Executive’s review.
IAASA’s Head of Financial Reporting Supervision
is a member of the EECS Agenda Group.
Accordingly, IAASA has a direct input into the
selection of emerging cases and decisions as
tabled by EU national financial reporting enforcers
for discussion at EECS plenary meetings.
As part of the regular activities of EECS, in 2014
IAASA:
a) supplied information for ESMA publications
and conducted surveys on the application of
IFRS across the EU from an Irish perspective;
b) attended 8 of 9 (2013: 9/9) EECS plenary
meetings held in 2014 and actively
participated in the consideration of issues
brought to EECS by other members;
c) submitted 4 (2013: 5) decisions to the EECS
database. The subject matter of these
decisions is set out in Appendix 6;
d) presented 3 (2013: 2) decisions to the plenary
meetings for discussion. The subject matter
of these decisions is set out in Appendix 6;
e) submitted and presented 3 (2013: 1) emerging
cases to the plenary meetings for discussion.
The subject matter of these emerging cases is
set out in Appendix 6;
f) presented the following IAASA publications
at the EECS plenary meetings:
- IAASA’s Annual Report 2013;
- IAASA’s 2014 Observations document; and
- IAASA’s Paper Review of the application
of IAS 7 Statement of Cash Flows by
selected Irish equity issuers; and
g) contributed to the revision of ESMA’s
Enforcement Guidelines through the
Head of Financial Reporting Supervision’s
membership of the Revision of Enforcement
Standards Group.
As a consequence of the discussion of emerging
cases and decisions at EECS plenary meetings,
three matters raised by IAASA (namely,
classification of puttable financial instruments
as between liability and debt, recognition &
measurement of UTPs, and classification of liabilities
between current and non-current liabilities) were
added to the agenda for further discussion between
EECS and IFRS-IC representatives.
6.2. IAASA engagement with the International
Accounting Standards Board
Arising out of IAASA’s examinations in 2014 a number
of financial reporting matters have been raised at
international level with IASB Board members and
with IFRS-IC representatives. These included:
a) Accounting for UTPs:
Issuers apply a variety of methods in
recognising and measuring UTPs. Following
IAASA’s discussions with the IASB, the matter
was formally and publicly discussed by IFRS-IC.
IFRS-IC tentatively decided to proceed with
a project on measurement of UTPs, subject
to further analysis and deliberation. This may
lead to a clarification or change to the financial
reporting standard. UTPs have been identified
as one of the common enforcement priorities
identified by ESMA for the 2015 cycle of reviews.
Financial reporting enforcers across Europe will
be required to pay particular attention to UTPs
when carrying out their examinations in 2015.
b) Deferred tax assets – forecast period:
The extended period of time which issuers use
to forecast taxable profits underpinning the
recognition and measurement of deferred tax
assets was formally raised by IAASA with EECS
and, through ESMA, with IASB Board members
and with IFRS-IC representatives. Deferred tax
assets have also been identified as one of the
common enforcement priorities identified by
ESMA for the 2015 cycle of reviews.
c) Operating segments
Paragraph 22 of IFRS 8 Operating Segments
was amended in December 2013 by requiring
disclosure of the judgements made by
management in applying the Standard’s
aggregation criteria. This disclosure includes
a brief description of the operating segments
that have been aggregated and the economic
indicators that have been assessed in
determining that the aggregated operating
segments share similar economic characteristics.