Decision Summary June 22, 2017

This summary of Accounting Standards Board (AcSB) decisions has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussion on projects, which may change after further deliberations by the AcSB. Decisions to publish Handbook material are final only after a formal ballot process.

International Financial Reporting Standards

Accounting Standards Advisory Forum

Board members advised the Chair on points to raise at the July 2017 meeting of the Accounting Standards Advisory Forum on topics to be discussed at that meeting. The topics included principles of disclosure, operating segments and fair value measurement (see the Forum’s Agenda Papers 2, 5, 7, and 7A at Select a Meeting – 6-7 July).

Insurance Contracts Implementation Group

The Board approved the establishment of an AcSB Insurance Transition Resource Group, to be chaired by Board member Charles Henaire. The Group will discuss Canadian implementation concerns that arise and support any Canadian member(s) of the IASB’s Transition Resource Group for IFRS 17 Insurance Contracts should such a member be appointed.

The Board directed the staff to bring a terms of reference and statement of operating procedures for the Group to a future meeting.

Post-implementation review (PIR) of IFRS 13 Fair Value Measurement

The Board approved a plan to respond to the IASB’s Request for Information on its “Post-implementation Review of IFRS 13 Fair Value Measurement”.

The Board encourages stakeholders to share their views on the Request for Information by submitting comment letters to the IASB by September 22, 2017 with a copy to the AcSB.

Standards for Private Enterprises

2018 Annual Improvements

The Board considered issues for inclusion in the 2018 annual improvements process and decided that one item had merit as an annual improvement. The issue relates to the need to delete an example in Section 3465, Income Taxes, on the application of the future income tax method for temporary differences arising from “eligible capital expenditures” that is no longer applicable given recent changes to the Income Tax Act (Canada).

The Board decided to defer this issue to the 2019 annual improvements process to allow stakeholders time to focus on upcoming exposure drafts for Agriculture, Financial Instruments and Redeemable Preferred Shares. There will be no 2018 annual improvements.

Other items included in the priorities for Part II

The Board discussed a number of matters but decided that they are beyond the scope of an annual improvement. The Board will deliberate approaches to address these issues at a later date. 


The Board continued its deliberations on the key issues raised by stakeholders and considered advice of its Agriculture Advisory Group on several topics related to the project scope and definitions, and measurement.

Scope and definitions

The Board decided that the scope of the proposed guidance should be similar to that provided by U.S. GAAP, by defining and referring to agricultural producers, rather than agricultural activity. As a result, agricultural inventories would be within the scope of the project when they are held by an enterprise that is an agricultural producer, regardless of whether or not they are the output of that enterprise’s agricultural activity.

Conversely, inventories acquired by enterprises that do not meet the definition of an agricultural producer, such as secondary processors (for example, flour mills), retailers (for example, pet shops) or broker-traders (for example, grain elevators), would remain in the scope of Section 3031, Inventories.

The Board also agreed that the definition of agricultural producers should be expanded to explicitly include aquaculture, as well as provide additional examples for greater clarity.

The Board reaffirmed its decision that government grants, land and quotas are not within the scope of this project.


The Board decided that agricultural producers should measure:

  • agricultural inventories at current value when conditions are met, or at cost; and
  • productive biological assets at cost.

When determining cost, the Board decided to provide the option to use either direct costs only, or full cost. The Board will decide on the specific costs to be included under each approach after receiving further advice from its Agriculture Advisory Group.

The Board also agreed that providing some practical expedients may be useful to stakeholders in determining cost, and that they be provided when they will reduce complexity for preparers yet provide useful information to users.

The Board also discussed whether amortization should be required when productive biological assets are managed and accounted for on a group basis, and the useful life and productive capacity of the group does not change significantly over time. Board members will further consider the need to amortize a group of assets at a future meeting.

When determining current value, the Board considered the advice of its Agriculture Advisory Group and agreed that the most appropriate measure of current value for agricultural inventories is net realizable value. The Board will decide the conditions on when agricultural inventories may be measured at net realizable value instead of cost, after considering further input from the Agriculture Advisory Group.

Financial Instruments – Narrow-scope Amendments

The Board received an update on additional stakeholder feedback received and confirmed that the initial measurement of related party financial instruments will continue to be included in the scope of the project.

In that regard, the Board discussed possible initial measurement concepts for related party financial instruments, and directed the staff to explore further how those concepts can be described. The Board also decided on the approach to the accounting for impairment and forgiveness of related party financial instruments.

The Board will consider the remaining issues and next steps, as well as the project timeline to issue an exposure draft by no later than the fourth quarter of 2017, at its next meeting.

Redeemable Preferred Shares

The Board continued its discussion on the circumstances in which classification of redeemable preferred shares may need to be reassessed after initial recognition. The Board reaffirmed its view that the need to reassess classification should be based on the occurrence of an event or transaction and decided on some examples that should be provided in the guidance.

The Board also considered the proposed drafting of one of the conditions, in addition to retention of control of the enterprise, and decided on the guidance that should be provided in respect of this condition. 

The Board also decided that:

  • on transition, enterprises will be provided an option to not restate comparatives;
  • the proposed effective date of the amendments will be January 1, 2020; and
  • Section 1500, First-time Adoption, will be amended to allow the same transitional relief for enterprises applying Accounting Standards for Private Enterprises subsequent to the date that the amendments are made effective.

The Board will issue a re-exposure draft on these proposals no later than September 30, 2017.

Due Process and Governance

Board Advisory Committees

The Board received feedback on the discussions at recent meetings of its IFRS Discussion Group, Private Enterprise Advisory Committee, Agriculture Advisory Group and Academic Advisory Council.


Read about AcSB recommendations made to influence the development of IFRS and enhance the global comparability of financial reporting outcomes, including US GAAP, in the Board’s Responses to IASB Documents for Comment and Responses to Other Documents for Comment.