11 February 2008

EFRAG consults on assessments of the cost and benefits of implementing IAS 1 and IFRIC 14

EFRAG issued an invitation to comment on the revised IAS 1 - Presentation of Financial Statements and IFRIC 14 IAS 19 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction. The primary purpose is to request comments on EFRAG’s initial assessment of the costs and benefits involved.

The revised IAS 1 will:

● involve preparers incurring some year one costs - in order to read, understand and implement the new requirements - but that those costs will be insignificant;

● not involve preparers incurring significant incremental ongoing costs; and

● involve users incurring only insignificant incremental year one or ongoing costs.

IFRIC 14 will:

● involve preparers incurring some year one costs - in order to read, understand and implement the new requirements - but that those costs will not be significant;

● not involve preparers incurring significant incremental ongoing costs; and

● not involve users incurring any incremental year one or ongoing costs.

EFRAG has also been assessing IAS 1 (Revised) and IFRIC 14 against the criteria for endorsement set out in Regulation (EC) No 1606/2002. EFRAG’s near-final conclusion is that neither IAS 1 (Revised) nor IFRIC 14 is contrary to the true and fair principle and that both meet the criteria of understandability, relevance, reliability and comparability

Deadline for comments is 14 March 2008.

Press release

IAS 1 Revised and IFRIC 14 Effects Studies consultation (zip file)

© EFRAG - European Financial Reporting Advisory Group