IFRS EU endorsement process [May 2023]
The European Financial Reporting Advisory Group (EFRAG) updated its report showing the status of endorsement of each IFRS, including standards, interpretations, and amendments, most recently on 5 April 2023.
On 31 March 2021, the International Accounting Standards Board (IASB) published 'Covid-19-Related Rent Concessions beyond 30 June 2021 (Amendment to IFRS 16)' that extends, by one year, the May 2020 amendment that provides lessees with an exemption from assessing whether a COVID-19-related rent concession is a lease modification.
In May 2020, the IASB issued Amendments to IFRS 16 Covid-19-Related Rent Concessions. The pronouncement amended IFRS 16 Leases to provide lessees with an exemption from assessing whether a COVID-19-related rent concession is a lease modification. On issuance, the practical expedient was limited to rent concessions for which any reduction in lease payments affects only payments originally due on or before 30 June 2021. You can find more information in our article IASB Amended IFRS 16 Due to the COVID-19 Pandemic from June 2020.
Since lessors continue to grant COVID-19-related rent concessions to lessees and since the effects of the COVID-19 pandemic are ongoing and significant, the IASB decided to extend the time period over which the practical expedient is available for use.
The changes in the Amendments to IFRS 16 Covid-19-Related Rent Concessions beyond 30 June 2021 amend IFRS 16 to:
- permit a lessee to apply the practical expedient regarding COVID-19-related rent concessions to rent concessions for which any reduction in lease payments affects only payments originally due on or before 30 June 2022 (rather than only payments originally due on or before 30 June 2021);
- require a lessee applying the amendment to do so for annual reporting periods beginning on or after 1 April 2021;
- require a lessee applying the amendment to do so retrospectively, recognising the cumulative effect of initially applying the amendment as an adjustment to the opening balance of retained earnings (or other component of equity, as appropriate) at the beginning of the annual reporting period in which the lessee first applies the amendment; and
- specify that, in the reporting period in which a lessee first applies the amendment, a lessee is not required to disclose the information required by paragraph 28(f) of IAS 8.
The amendment is effective for annual reporting periods beginning on or after 1 April 2021. A lessee is permitted to apply the amendment early, including in financial statements not authorised for issue at 31 March 2021, the date the final amendment was issued.
A lessee must apply the practical expedient consistently to eligible contracts with similar characteristics and in similar circumstances, irrespective of whether the contract became eligible for the practical expedient as a result of the May 2020 amendment or the March 2021 amendment.
Final endorsement of this amendment to IFRS 16 for use in the EU is currently expected in May or June 2021.
Source: www.iasplus.com, IFRS in Focus
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