The Accounting Standards Council (ASC) has submitted comment letters to the SME Implementation Group on IFRS for SMEs Draft Q&A Accounting for financial guarantees in parent’s separate financial statements.
Draft Q&As which was developed in June 2017 provide non-mandatory and timely guidance on specific accounting questions raised by entities implementing the IFRS for SMEs Standard, as well as other interested parties.
Subject to its comments, ASC is generally supportive of the proposed amendments to IAS 1 and IAS 8 on the basis of the IASB’s rationale as described in the Basis for Conclusions on the ED and states that the proposed amendments, together with IFRS Practice Statement 2 Making Materiality Judgements, would potentially improve entities’ understanding of the concept of materiality and confidence in making materiality judgements.
In addition, ASC has also agreed that the proposed amendments are not substantive changes to the underlying concept of materiality in IFRS Standards.
However, ASC suggest that where the IASB decides to proceed with the proposal, it should consider to include in the accompanying explanation, a description of the decisions made by primary users on the basis of financial statements.
The comment letters submitted can be viewed from ASC website.
Source: ASC, 31 August 2017