Each quarter, we provide a summary of newly effective and forthcoming standards as well as other significant accounting and financial reporting developments. This edition covers current developments in the quarter ended on September 30, 2022.
Each quarter, we highlight the challenges faced by your company, your employees and your customers in these uncertain times. The global economic uncertainty continues while issues such as COVID-19, natural disasters, geopolitical events, inflation and economic slowdowns evolve. Our Financial reporting in uncertain times resource centre – which features a range of articles, blogs and podcasts – explores the potential accounting and disclosure implications for your company.
Interest rates continue to rise in Canada and many other countries. This may impact the measurement of assets, liabilities and net interest expense, and trigger impairment losses. Refer to our webpage where we highlight some of the key financial reporting areas that may be affected by rising interest rates.
With the expectation of finalizing its first two standards as early as possible in 2023, the International Sustainability Standards Board (ISSB) discussed in September 2022 the themes of comment letters received on its two exposure drafts and an action plan of areas to prioritize. The ISSB also discussed how to ensure that the final standards are ‘scalable’ or feasible for all types of companies to adopt as well as the complex area of financed and facilitated emissions.
As insurers prepare for the January 2023 implementation date of IFRS 17 Insurance Contracts and IFRS 9 Financial Instruments, they should consider the pre-transition disclosures on the impact of these standards. Investors, regulators and other stakeholders will expect these to provide timely and useful information. Refer to our seven-step action plan which helps companies prepare for reporting in 2022 and 2023.
In September 2022, the IASB issued amendments to IFRS 16 Leases1 which impact how a seller-lessee accounts for variable lease payments that arise in a sale-and-leaseback transaction. For additional information about the amendments, refer to our web article.
At its June 2022 meeting, the IFRIC reached its conclusions on the tentative agenda decision Cash Received via Electronic Transfer as Settlement for a Financial Asset (IFRS 9), which addressed when a payee derecognizes a trade receivable and recognizes cash when using an electronic transfer system for settlement. Following feedback from respondents on the IFRIC’s tentative agenda decision, instead of finalizing the decision proposed by the IFRIC, the IASB has decided to explore narrow-scope standard setting on electronic payments as part of its post-implementation review of IFRS 9 Financial Instruments. For more information about this topic, refer to our webpage. A number of new requirements are effective from January 1, 2022. Further information on these new requirements is provided in the section Requirements effective in 2022.
Our 2022 guides to condensed interim and annual financial statements will help you prepare financial statements in accordance with IFRS Standards. The updated annual guides reflect standards in issue at August 31, 2022 that are required to be applied by a company with an annual reporting period beginning on January 1, 2022.
