7 Post Implementation Review of IFRS 15—PIP

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22 June 2023 Agenda Paper 7

Executive Summary

Project Type	Influencing
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:--------------	:--------------
Project Scope	Moderate

Purpose of the paper

This paper provides the Board with a draft Project Initiation Plan (PIP) for the project to respond to the IASB’s forthcoming Request for Information (Rfl) for the Post- implementation Review (PIR) of IFRS 15 Revenue from Contracts with Customers.

Summary of the Issue

In accordance with its due process, the IASB is required to conduct a PIR for each new IFRS Accounting Standard and major amendment. The purpose of the PIR is to assess whether the standard or amendment is meeting its objectives, can be applied consistently, that information is useful to users of financial statements, and that implementation costs are as expected.

The draft PIP covers the influencing work proposed for the project to develop the UKEB’s response to the IASB. Stakeholder outreach on this project has already commenced and the proposed workplan, which takes a proportionate approach to the project, reflects both the context of the project and feedback received to date from UK stakeholders.

At its May 2023 meeting the IASB approved the publication of the Rfl, which is expected to be published at the end of June 2023, with an expected comment deadline in late October 2023. This will constrain UKEB project timelines as the timetable for the development of the UKEB draft comment letter does not fit easily with UKEB meeting schedule and the expected UKEB consultation period overlaps with interim reporting and summer holidays for a significant number of UK stakeholders.

As a result, this paper includes options for the Board to consider for the approval of the comment letter for the Rfl.

Decisions for the Board

Does the Board agree with the staff recommendation that the Draft Comment Letter (DCL) should be presented at the meeting on 13 July 2023 and the Final Comment Letter (FCL) at the meeting on 19 October 2023?
Does the Board approve the draft PIP for this project?

Recommendation

The Secretariat recommends that:

the DCL is presented at the 13 July 2023 Board meeting and the FCL presented at the 19 October 2023 Board meeting; and that
subject to any necessary amendments identified by the Board, the Board approves the PIP.

Appendices

Appendix A Draft Project initiation Plan (PIP)

Purpose

1This paper provides the Board with a Project Initiation Plan (PIP) for the project to respond to the IASB’s forthcoming Request for Information (Rfl) for the Post- implementation Review (PIR) of IFRS 15 Revenue from Contracts with Customers.

Background

2In accordance with its due process, the IASB is required to conduct a PIR of each new IFRS Accounting Standard and major amendment. The purpose of the PIR is to assess whether the standard or amendment is meeting its objectives, can be applied consistently, that information is useful to users of financial statements, and that implementation costs are as expected.

3The IASB’s possible actions following the PIR are to:

produce educational materials;
conduct follow-up research work for possible standard setting; or
take no action.

4In November 2021 the IASB decided to commence the PIR of IFRS 15 in the second half of 2022. In September 2022 the IASB discussed the plan for phase 1 of the PIR.

5In March 2023, the IASB discussed findings from phase 1 of the PIR and tentatively decided which matters to examine further in the Rfl.

6At its May 2023 meeting the IASB approved the publication of the Rfl which is expected to be published at the end of June 2023, with an expected comment deadline in late October 2023 (i.e. 120-day comment period).

7So far, the UKEB Secretariat has conducted outreach activities on this project with the UKEB Accounting Firms and Institutes Advisory Group (AFIAG), the UKEB Preparer Advisory Group (PAG) and engaged with the UKEB Academic Advisory Group (AAG). In doing so we have received feedback on the IFRS 15 requirements from both a preparer and auditor perspective.

Options to consider for approval of Comment Letter

8The IASB Rfl is expected to be published at the end of June 2023 with a consultation period expected to end in late October 2023. This constrains UKEB project timelines since the timetable for the development of the UKEB Draft Comment Letter (DCL) does not fit easily with the UKEB meeting schedule and the expected UKEB consultation period overlaps with interim reporting periods and summer holidays. For this reason, we set out below options and a recommendation for the Board’s consideration and decision.

Options for consideration

9The Board has the following principal options in relation to approval of the comment letter for the Rfl. These options assume that the Rfl will be published in the last week of June:

Option	Pros	Cons
a DCL presented at the 13 July 2023 UKEB meeting and FCL presented at the 19 October 2023 UKEB meeting (62 days consultation period)	IASB deadline achieved, no exception required from due process as stakeholders would have the required 30 days to respond to the Invitation to Comment. Longer consultation period than option b. Takes into account the summer holiday period but assumes the deadline for submission of comment letter will be the last week of October.	The DCL may not present as full a response due to limited outreach conducted.
b DCL presented at the 13 July 2023 UKEB meeting and FCL presented at the 21 September UKEB meeting (30 days consultation period)	IASB deadline achieved, no exception required from due process as stakeholders would have the required 30 days to respond to the Invitation to Comment.	The DCL may not present as full a response due to limited outreach conducted. Shorter consultation period than option a, falling during the summer holiday season.

10We have also considered the following alternative options below:

Option	Pros	Cons
c DCL presented at the 21 September 2023 UKEB meeting and FCL presented at the 19 October 2023 UKEB meeting (reduce the consultation period¹ from 30 days to one week)	IASB deadline achieved. Provides the Secretariat more time to draft the DCL with more evidence from outreach conducted.	An exception to the UKEB due process would be required as stakeholders would only have one week to respond to the UKEB Invitation to Comment. Minimum UK stakeholder outreach, engagement, and feedback on the DCL.
d DCL presented at the 21 September 2023 UKEB meeting and FCL presented at the 16 November UKEB meeting (30 days consultation period)	Provides the Secretariat more time to draft the DCL with more evidence from outreach conducted. Maximum time for analysis, stakeholder outreach and feedback.	A deadline extension could be requested. However, IASB meets between 13–17 November and may discuss a summary of the feedback. UKEB position would not be available for this meeting.

Recommendation

11The Secretariat recommends consideration of the DCL at the Board’s 13 July 2023 meeting and consideration of the FCL at the Board meeting on 19 October 2023 (option a above). This option meets the IASB deadline and does not require an exception from standard UKEB due process. Whilst the DCL may not respond to all the questions and its content will be limited to initial feedback we gather from stakeholders, the Secretariat intends to continue with outreach activities while the DCL is out for consultation, with a view to updating responses to the questions, if appropriate.

12The PIP is prepared based on the above recommendation but if the Board prefers a different approach the PIP will be updated with the Board’s preferred option and uploaded to the UKEB website.

Question for the Board

Does the Board agree with the staff recommendation that the DCL should be presented at the 13 July 2023 meeting and the FCL presented at the meeting on 19 October 2023?

Project Initiation Plan (PIP)

13The draft PIP is attached at Appendix A for consideration, and the Board is asked whether it approves the approach set out in the PIP.

Question for the Board

Does the Board approve the PIP for this project?

Next steps

14The Secretariat expects to bring a Draft Comment Letter for the Board’s consideration at the 13 July 2023 meeting.

Appendix A: Draft Project Initiation Plan: Post-implementation Review of IFRS 15 Revenue from Contracts with Customers

Project Type	Influencing—Post-implementation Review
Project Scope	Moderate

Purpose

A1This paper sets out the plan to influence the IASB in relation to the Post- implementation Review (PIR) of IFRS 15 Revenue from Contracts with Customers. The associated IASB Request for Information (Rfl) is expected to be published in late June 2023.

Background

A2In May 2014 the IASB issued IFRS 15. The standard was effective for annual periods commencing on or after 1 January 2018. In April 2016 the IASB issued clarifications to IFRS 15 which became effective at the same time as the rest of the standard.

A3IFRS 15 replaced IAS 11 Construction Contracts, IAS 18 Revenue, IFRIC 13 Customer Loyalty Programmes, IFRIC 15 Agreements for the Construction of Real Estate, IFRIC 18 Transfers of Assets from Customers and SIC-31 Revenue—Barter Transactions Involving Advertising Services.

A4IFRS 15 is largely converged with Topic 606 Revenue from Contracts with Customers issued at the same time by the US Financial Accounting Standards Board (FASB), except for some minor differences². The aim was to improve comparability in the ‘top line’ of the financial statements of companies globally.

A5After IFRS 15 became effective, the IFRS Interpretation Committee discussed a number of application questions relating to IFRS 15 and published nine agenda decisions on the following matters:

principal versus agent considerations in software distribution industry (May 2022);
accounting for training costs (March 2020);
compensation for delays or cancellations in airline industry (September 2019);
borrowing costs (March 2019) and costs to fulfil a construction contract (June 2019);
accounting for upfront listing fees (January 2019); and
real estate revenue accounting (three agenda decisions—March 2018).

A6The objective of the PIR is to consider the standard’s core principle and the five-step revenue recognition model, including the benefits to users of financial statements and the costs for preparers.

A7In May 2023 the IASB approved the publication of the Rfl for this project and expects to issue the Rfl in late June 2023, with an expected comment deadline in late October 2023 (i.e. 120-day comment period).

IASB forthcoming Request for Information

A8Tentative decisions from the IASB March 2023³ meeting suggest the Rfl will include the following topics:

IFRS 15 as a whole and convergence with the US Financial Accounting Standards Board’s Topic 606, specifically:
1. whether IFRS 15 meets its overall objective;
2. the clarity and suitability of the core principle of the standard and the five-step revenue recognition model for making revenue accounting decisions;
3. suggestions for specific narrow-scope improvements for the IASB to consider that could improve the understandability of IFRS 15 without causing substantial cost and disruption to entities already applying the standard;
feedback from the implementation of IFRS 15 for the IASB to consider in improving the understandability and accessibility of future standards;
the ongoing costs and benefits of applying the requirements in IFRS 15; and
the importance of retaining convergence between IFRS 15 and the Financial Accounting Standards Board’s Topic 606.

The five steps of revenue recognition and related areas:
1. Fact patterns in relation to which: * guidance on identifying performance obligations in a contract is applied inconsistently, leads to outcomes that do not reflect the underlying economic substance or leads to significant ongoing costs; * guidance on determining the timing of revenue recognition is unclear or may be applied inconsistently—particularly with respect to the criteria for recognising revenue over time; * guidance on determining whether an entity is a principal or an agent is unclear or may be applied inconsistently; and * guidance on accounting for licensing is unclear or may be applied inconsistently.
2. Evidence of diversity in practice in determining the transaction price in a contract, specifically in relation to consideration payable to customers.
3. Disclosure requirements, including the costs of meeting those requirements and the benefits of the resulting information to users of financial statements.
4. Transition requirements: * whether the option to use the modified retrospective method and the practical transition reliefs offered by IFRS 15 were used by preparers of financial statements; and * whether they achieved an appropriate balance between reducing the cost and burden for preparers of financial statements and providing useful information to users of financial statements.
Interaction with other IFRS Accounting Standards, specifically about the application of IFRS 15 alongside other IFRS Accounting Standards, focusing on: * IFRS 3 Business Combinations; * IFRS 9 Financial Instruments; and * IFRS 16 Leases.

Initial research and stakeholder feedback

A9Our initial desk-based research indicates that the effect of applying IFRS 15 varies across sectors i.e. some sectors experienced significantly greater changes in recognition and measurement of revenue than others.

A10In anticipation of the IASB publishing the Rfl later in June 2023, we have also commenced consultations with stakeholders, including members of the UKEB Accounting Firms and Institutes Advisory Group (AFIAG), the Investor Advisory Group (IAG) and the Preparer Advisory Group (PAG) on this project⁴.

A11The feedback from these groups suggests that, overall, the requirements of IFRS 15 are working well, do not contain “fatal flaws” and represent an improvement on the previous revenue recognition requirements.

A12These groups identified some topics within the IFRS 15 requirements that nonetheless are causing concern (listed below), and where action following the PIR would be welcome. We will explore these topics further during outreach and ask stakeholders for suggestions on how the IASB could further improve the standard i.e. narrow-scope amendments or additional guidance. We plan to ask stakeholders for fact patterns in relation to the problem areas where the guidance is unclear or may be applied inconsistently.

A13It is possible that not all the issues identified in the Rfl are of significant concern to UK stakeholders, which is likely to impact the areas of focus in the UKEB’s Comment Letter to the IASB.

A14The topics identified from initial desk-based research and discussion with UKEB Advisory Groups are:

identifying the performance obligations in a contract;
determining the transaction price;
principal versus agent considerations;
licensing;
the application of IFRS 15 alongside IFRS 16 Leases;
the usefulness and cost of some of the disclosure requirements from a preparer perspective; and
inconsistencies in the presentation of information.

A15Further priority issues may emerge during the stakeholder consultation process for the project.

Identifying the performance obligations in a contract and recognising revenue

A16For some sectors, preparers find identifying performance obligations in a contract challenging because it involves significant judgement.

Determining the transaction price

A17There are a number of application matters related to determining the transaction price, in particular variable consideration. Some stakeholders have expressed concerns about applying the guidance on constraining estimates of variable consideration.

Principal versus agent considerations 5

A18Auditors and preparers have raised concerns on the challenges related to accounting for contracts involving principal-agent considerations.

A19Some of the specific concerns raised by preparers include the significance and complexity of judgements involved on this topic. However, whilst there are challenges in this area, the initial assessment appears to be that there are no fatal flaws with the standard.

A20We note the IFRS Interpretation Committee’s discussions in the Agenda Decision: Principal versus Agent: Software Reseller (IFRS 15 Revenue from Contracts with Customers) (May 2022) indicated that in the fact pattern the reseller would apply judgement in making its overall assessment of whether it is a principal or agent.

Licensing 6

A21We are aware that some preparers find applying the guidance on licensing⁷ in IFRS 15 challenging. They consider that more guidance or illustrative examples on this topic would be useful, for example out-licensing, license renewals or software as a service (SaaS). During the outreach phase of the project the project team will aim to gather more specific feedback from stakeholders on the circumstances in which entities face challenges in applying the IFRS 15 guidance for licensing and whether it merits improvement.

The application of IFRS 15 alongside IFRS 16 Leases

A22There appear to be some concerns amongst preparers on the interaction between IFRS 15 and IFRS 16, in particular the complexity on separating performance obligations and sale and leaseback transactions.

Disclosure requirements

A23As noted above, IFRS 15 was intended to provide more useful information through improved disclosure requirements.

A24We plan to seek further direction from users on disclosures, in particular on the use of some of the existing disclosures where preparers have indicated the cost of providing the information is onerous and where they perceive no clear benefits for users.

A25We plan to ask users whether they are still requesting any additional disclosures i.e. those not currently required by IFRS 15.

Inconsistencies in presentation of information

A26The project team intend to gather feedback from users on whether they have any concerns about inconsistencies in presenting information in the financial statements. For example, some companies present negative consideration⁸ as ‘negative revenue’ whilst others present it as an expense and there appears to be inconsistency in the treatment of consideration payable to customers.

Project plan rationale

A27The following considerations have shaped the project plan.

The threshold for change is high

A28The IASB Due Process Handbook⁹ notes that there is no presumption that a PIR will lead to any changes to a standard. The IASB website explains that, should the IASB decide to take action, only high priority matters would be actioned as soon as possible. Lower priority actions could be added to the research pipeline or considered in the next agenda consultation.

Stakeholder feedback to date suggests the IFRS 15 requirements are broadly working well

A29Feedback provided by the UKEB Advisory Groups to date indicates that IFRS 15 requirements do not contain any fatal flaws and are, broadly, working as intended. That feedback suggests that limited improvement is required in a small number of specific areas.

Implications for the project plan

A30As noted in paragraph A28 above, the IASB’s threshold for amending the standard as a result of this PIR is high and stakeholders are broadly satisfied that IFRS 15 requirements are working as intended. Further, the PIR is not intended to reopen debates previously considered or to identify and resolve every application question.

A31Consequently, the work will focus on specific requirements of the standard where stakeholders have indicated that additional guidance would be helpful and that we consider the IASB could address effectively and efficiently.

A32The project plan set out below is dependent on availability of Secretariat resource and Board time, and interaction with other live UKEB projects. If these factors lead to a material variation in the plan, a revised PIP would be submitted to the Board.

Setting up an ad-hoc advisory group is not necessary

A33Given the scope and nature of the project, it is not considered necessary to set up a separate, ad-hoc advisory group as the existing UKEB Advisory Groups are well placed to provide feedback on this project.

Outreach

UK Stakeholders

A34In addition to the publication of the Draft Comment Letter (DCL) for general consultation, we propose to undertake a number of specific outreach activities as follows:

Preparer roundtable(s) targeting those who are involved in the sectors most impacted by IFRS 15, in particular, aerospace and defence, construction, services, asset managers, life sciences, media & entertainment, real estate, software, telecommunications and retail.
Discussions with investors and other users focusing on sectors most impacted by IFRS 15.

A35We plan to promote the DCL via the UKEB Advisory Groups and via the usual media channels (LinkedIn, News Alerts).

A36We propose to supplement this outreach with desk-based research, including review of the FRC’s analysis of IFRS 15 implementation contained in the Corporate Reporting Annual and Thematic reviews.

International Stakeholders

A37We plan to reach out to the EFRAG project team to understand the feedback from their stakeholders and identify any overlap with issues we are hearing from UK stakeholders. We may speak to other national standard setters should we become aware of areas of potential overlap.

Project milestones

A38A proportionate approach is proposed, incorporating the mandatory milestones listed in paragraph 5.3 of the UKEB’s Due Process Handbook (Handbook)¹⁰. The table below provides a brief description of the work we have done and what we intend to do as part of this project.

| Milestone/activity | Brief description |

Resources allocated

A39On the basis of this project plan, we consider that a project team consisting of one Project Director and one Project Manager, with technical support and oversight from a Senior Project Director, should ensure the project milestones are achievable.

Project timelines

A40We expect the Rfl to be published in late June 2023 and the IASB comment deadline to be late October 2023.

A41The primary outreach for this project so far has been the UKEB advisory group meetings in November 2022, March 2023 and June 2023.

A42In July 2023, work will focus on considering the published Rfl and whether any further feedback should be sought from other relevant stakeholder groups.

A43The expected project timelines shown below are based on the recommended approach i.e. presentation of the DCL at the UKEB meeting on 13 July and FCL at the UKEB meeting on 19 October 2023.

Timeline

Expected Dates	Milestone
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Expected Dates

Milestone

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Resources allocated

Project timelines

A40We expect the Rfl to be published in late June 2023 and the IASB comment deadline to be late October 2023.

A41The primary outreach for this project so far has been the UKEB advisory group meetings in November 2022, March 2023 and June 2023.

A42In July 2023, work will focus on considering the published Rfl and whether any further feedback should be sought from other relevant stakeholder groups.

A43The expected project timelines shown below are based on the recommended approach i.e. presentation of the DCL at the UKEB meeting on 13 July and FCL at the UKEB meeting on 19 October 2023.

Timeline

Expected Dates	Milestone

A5After IFRS 15 became effective, the IFRS Interpretation Committee discussed a number of application questions relating to IFRS 15 and published nine agenda decisions on the following matters:

principal versus agent considerations in software distribution industry (May 2022);
accounting for training costs (March 2020);
compensation for delays or cancellations in airline industry (September 2019);
borrowing costs (March 2019) and costs to fulfil a construction contract (June 2019);
accounting for upfront listing fees (January 2019); and
real estate revenue accounting (three agenda decisions—March 2018).

IASB forthcoming Request for Information

A8Tentative decisions from the IASB March 2023³ meeting suggest the Rfl will include the following topics:

IFRS 15 as a whole and convergence with the US Financial Accounting Standards Board’s Topic 606, specifically:
1. whether IFRS 15 meets its overall objective;
2. the clarity and suitability of the core principle of the standard and the five-step revenue recognition model for making revenue accounting decisions;
3. suggestions for specific narrow-scope improvements for the IASB to consider that could improve the understandability of IFRS 15 without causing substantial cost and disruption to entities already applying the standard;
feedback from the implementation of IFRS 15 for the IASB to consider in improving the understandability and accessibility of future standards;
the ongoing costs and benefits of applying the requirements in IFRS 15; and
the importance of retaining convergence between IFRS 15 and the Financial Accounting Standards Board’s Topic 606.

The five steps of revenue recognition and related areas:
1. Fact patterns in relation to which: * guidance on identifying performance obligations in a contract is applied inconsistently, leads to outcomes that do not reflect the underlying economic substance or leads to significant ongoing costs; * guidance on determining the timing of revenue recognition is unclear or may be applied inconsistently—particularly with respect to the criteria for recognising revenue over time; * guidance on determining whether an entity is a principal or an agent is unclear or may be applied inconsistently; and * guidance on accounting for licensing is unclear or may be applied inconsistently.
2. Evidence of diversity in practice in determining the transaction price in a contract, specifically in relation to consideration payable to customers.
3. Disclosure requirements, including the costs of meeting those requirements and the benefits of the resulting information to users of financial statements.
4. Transition requirements: * whether the option to use the modified retrospective method and the practical transition reliefs offered by IFRS 15 were used by preparers of financial statements; and * whether they achieved an appropriate balance between reducing the cost and burden for preparers of financial statements and providing useful information to users of financial statements.
Interaction with other IFRS Accounting Standards, specifically about the application of IFRS 15 alongside other IFRS Accounting Standards, focusing on: * IFRS 3 Business Combinations; * IFRS 9 Financial Instruments; and * IFRS 16 Leases.

Initial research and stakeholder feedback

A13It is possible that not all the issues identified in the Rfl are of significant concern to UK stakeholders, which is likely to impact the areas of focus in the UKEB’s Comment Letter to the IASB.

A14The topics identified from initial desk-based research and discussion with UKEB Advisory Groups are:

identifying the performance obligations in a contract;
determining the transaction price;
principal versus agent considerations;
licensing;
the application of IFRS 15 alongside IFRS 16 Leases;
the usefulness and cost of some of the disclosure requirements from a preparer perspective; and
inconsistencies in the presentation of information.

A15Further priority issues may emerge during the stakeholder consultation process for the project.

Identifying the performance obligations in a contract and recognising revenue

A16For some sectors, preparers find identifying performance obligations in a contract challenging because it involves significant judgement.

Determining the transaction price

Principal versus agent considerations 5

A18Auditors and preparers have raised concerns on the challenges related to accounting for contracts involving principal-agent considerations.

Licensing 6

The application of IFRS 15 alongside IFRS 16 Leases

Disclosure requirements

A23As noted above, IFRS 15 was intended to provide more useful information through improved disclosure requirements.

A25We plan to ask users whether they are still requesting any additional disclosures i.e. those not currently required by IFRS 15.

Inconsistencies in presentation of information

Project plan rationale

A27The following considerations have shaped the project plan.

The threshold for change is high

Stakeholder feedback to date suggests the IFRS 15 requirements are broadly working well

Implications for the project plan

Setting up an ad-hoc advisory group is not necessary

Outreach

UK Stakeholders

A34In addition to the publication of the Draft Comment Letter (DCL) for general consultation, we propose to undertake a number of specific outreach activities as follows:

Preparer roundtable(s) targeting those who are involved in the sectors most impacted by IFRS 15, in particular, aerospace and defence, construction, services, asset managers, life sciences, media & entertainment, real estate, software, telecommunications and retail.
Discussions with investors and other users focusing on sectors most impacted by IFRS 15.

A35We plan to promote the DCL via the UKEB Advisory Groups and via the usual media channels (LinkedIn, News Alerts).

International Stakeholders

Project milestones

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Resources allocated

Project timelines

A40We expect the Rfl to be published in late June 2023 and the IASB comment deadline to be late October 2023.

A41The primary outreach for this project so far has been the UKEB advisory group meetings in November 2022, March 2023 and June 2023.

A42In July 2023, work will focus on considering the published Rfl and whether any further feedback should be sought from other relevant stakeholder groups.

A43The expected project timelines shown below are based on the recommended approach i.e. presentation of the DCL at the UKEB meeting on 13 July and FCL at the UKEB meeting on 19 October 2023.

Timeline

| Expected Dates | Milestone |

Resources allocated

Project timelines

A40We expect the Rfl to be published in late June 2023 and the IASB comment deadline to be late October 2023.

A41The primary outreach for this project so far has been the UKEB advisory group meetings in November 2022, March 2023 and June 2023.

A42In July 2023, work will focus on considering the published Rfl and whether any further feedback should be sought from other relevant stakeholder groups.

A43The expected project timelines shown below are based on the recommended approach i.e. presentation of the DCL at the UKEB meeting on 13 July and FCL at the UKEB meeting on 19 October 2023.

Timeline

Expected Dates	Milestone

Project timelines

A40We expect the Rfl to be published in late June 2023 and the IASB comment deadline to be late October 2023.

A41The primary outreach for this project so far has been the UKEB advisory group meetings in November 2022, March 2023 and June 2023.

A42In July 2023, work will focus on considering the published Rfl and whether any further feedback should be sought from other relevant stakeholder groups.

A43The expected project timelines shown below are based on the recommended approach i.e. presentation of the DCL at the UKEB meeting on 13 July and FCL at the UKEB meeting on 19 October 2023.

Timeline

PIR of IFRS 15 Project plan based on the recommended approach. A timeline displaying the UKEB project milestones and deadlines from April 2022 to November 2023, including board approvals, survey publications, and comment letter deadlines.

Footnotes

UKEB Due Process Handbook, contains the following relevant paragraph relating to DCL with a shorter consultation period: 5.16: ‘The UKEB may decide to issue a draft comment letter with a reduced comment period of less than 30 days when there is limited time to consult (i.e. due to the urgency of an issue or to the existence of reduced comment periods set by the IASB28). The rationale for a shorter consultation period is given in the PIP (refer to paragraph A2(e) in Appendix A of this Handbook)’. ↩
See Appendix A, pages 14-23 of Paper AP6A March 2023 IASB staff summary of the differences between IFRS 15 and Topic 606. ↩
The IASB March 2023 Agenda Papers and Meeting summary can be accessed here: https://www.ifrs.org/news-and-events/calendar/2023/march/international-accounting-standards-board/ ↩↩
We also contacted members of the Academic Advisory Group (AAG) by email to request any academic papers (published or working papers) that examine the implementation and application of IFRS 15, using data from UK companies. ↩↩
Paragraphs B34A-B38 of IFRS 15 provides the framework and requirements for principal versus agent considerations. ↩↩
Paragraphs B52-B62 of IFRS 15 provides the framework and requirements for licensing. ↩↩
When a company (the licensor) grants another organisation (the licensee) the rights to use a developed product, technology or intellectual property for further development, production or marketing, and typically receives royalties, upfront fees or milestone payments from the licensee. ↩↩
Negative consideration is when incentives payable to a customer exceed the amount of consideration expected to be received from the customer. ↩↩
IASB Due Process Handbook (August 2020) paragraph 6.58. ↩↩
UKEB Due Process Handbook (December 2022) ↩↩
UKEB Due Process Hand Book notes in relation to the mandatory Feedback Statement paragraph 5.22 ‘A feedback statement is published on the UKEB website, usually at the same time as the final comment letter is submitted to the IASB and in relation to the mandatory Due process compliance statement in paragraph 5.24 that ‘The (draft) due process compliance statement is initially presented to the Board along with the final comment letter and feedback statement for approval.’ ↩

7 Post Implementation Review of IFRS 15—PIP

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