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The Committee publishes agenda decisions when, following consultation, it has decided that standard-setting is not required to deal with a question from stakeholders. This usually means that the Committee has concluded that existing IFRS requirements are adequate to answer the question. When that’s the case, the agenda decision explains how IFRS Standards apply.
Because explanatory material set out in an agenda decision reflects existing requirements, two questions are often raised. First, does that mean that companies that have applied IFRS Standards in a manner inconsistent with an agenda decision necessarily have a prior period error? And secondly, does that mean that companies have to reflect the agenda decision in their next set of IFRS financial statements no matter how soon that might be? For example, if the Committee were to publish a final agenda decision in March 2019, do financial statements for a period ending 31 March 2019 have to reflect that agenda decision a matter of weeks later?
In relation to the first question, the IASB has acknowledged that agenda decisions often provide new information that should be seen as helpful and persuasive (for example, by integrating requirements in the Standards with material in the Basis for Conclusions and Illustrative Examples). This means that a company does not have an error simply because its application of IFRS Standards was inconsistent with an agenda decision.
In relation to the second question, until now the IASB has had nothing on record regarding how quickly companies are expected to implement an accounting policy change that results from an agenda decision. The IASB therefore decided to formally acknowledge that it may take time to implement such an accounting policy change. The IASB has done this to reflect its expectations of what is reasonable for preparers, to assist companies in implementing any such change and, ultimately, to support consistent application of IFRS Standards by facilitating accounting policy changes.