EFRAG's draft comment letter on the IASB's draft ED/2013/5, 'Regulatory Deferral Accounts'

24 May 2013

EFRAG published its draft comment letter on the IASB's ED/2013/5, 'Regulatory Deferral Accounts'. Comments on the letter are invited by 21 August, 2013.

EFRAG does not support the ED because:

• It results in a lack of comparability between (a) entities that take advantage of the ED and (b) entities that already apply IFRS or do not wish to apply the ED; and
• It is not limited to facilitating first-time adoption but maintains previous accounting policies for an indefinite period. Other interim standards such as IFRS 4 and IFRS 6 have shown that there was no such thing as a short-term interim standard.

Although EFRAG disagrees with the pursuance of this interim project, EFRAG is supportive of the IASB’s decision to make the standard an option and of its efforts to limit comparability issues to the regulatory deferral account balances. Consequently, EFRAG has carried out an analysis of the proposed standard:

• EFRAG assessed whether the IASB was successful with its intent of limiting comparability issues to the regulatory deferral account balance line items. We identified a number of issues that the IASB should resolve; and
• EFRAG considered the requirements in the ED and identified certain difficulties that application of the proposals may raise.

Press release

Draft comment letter

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