6 Items for Noting

File information

Publication date
14 September 2023
Format
PDF, 1.2 MB
Download original PDF

Appendix A: Due Process Compliance Statement: Exposure Draft: Amendments to the Classification and Measurement of Financial Instruments - Proposed amendments to IFRS 9 and IFRS 7

General UKEB requirements: The UKEB adopts international accounting standards for use within the UK, in accordance with SI 2019/685 and applies its own processes before it decides to endorse and adopt a new or amended international accounting standard.

Exposure Draft: Amendments to the Classification and Measurement of Financial Instruments – Proposed Amendments to IFRS 9 and IFRS 7 (the Amendments) was published on 21 March 2023. The IASB comment period ended on 19 July 2023.

Influencing process

Step Mandatory / optional¹ Metrics or evidence UKEB Secretariat comments
Project Preparation
Technical project added to UKEB technical work plan [Due Process Handbook (DPH) [4.29]] Mandatory Project is included in the UKEB published technical work plan. Complete: the Amendments were included in the UKEB technical work plans from July 2022 onwards.
Project preparation (continued)
Project Initiation Plan (PIP) [DPH 5.4 to 5.8] Mandatory PIP draft with project outline (background, scope, project objective) and approach for influencing (key milestones and timing) proportionate to the project Complete: A PIP including purpose (project objective), background, scope, and influencing approach was prepared, taking a proportionate approach to the project. The PIP was approved at the 27 April 2023 Board meeting.
Mandatory Outreach plan for stakeholders and communication approach outlined Complete: this plan was outlined in the PIP. In addition the Secretariat published a project page on the UKEB website.
Mandatory Resources allocated Complete: two Project Directors and two Project Managers worked across this project and the Post-Implementation Review of IFRS 9 project, as described in the PIP.
PIP is approved at public meeting [DPH 5.4] Required UKEB Board public meeting held to approve PIP Complete: the PIP was approved at the 27 April 2023 Board meeting.
Education sessions [DPH 4.10] Optional Board provided with education sessions on the proposals. Complete: An education session on the proposals was presented at the 27 April 2023 Private Board meeting.
Desk-based research [DPH 5.9] Optional Review of relevant documentation Complete: Desk based research was undertaken and key findings reported in the PIP.
Communications
Public board meetings [DPH 5.4, 5.14] Mandatory UKEB public meetings held to discuss technical project Complete: The Board discussed the Project Initiation Plan (PIP), at its 27 April 2023 meeting and approved the draft comment letter (DCL) for issue at its 18 May meeting. The Board discussed and approved the following documents at its 13 July 2023 meeting:
• Final Comment Letter.
• Feedback Statement.
• Draft Due Process Compliance Statement.
Secretariat papers Mandatory Board meeting papers posted and publicly available on a timely basis. Complete: The UKEB's April, June and July meeting papers were published on the UKEB website one week before the public meetings. Meeting minutes and recordings were made publicly available via the UKEB website. Subscribers were notified via the UKEB News Alerts.
Communications (continued)
Project webpage Optional Project webpage contains a project description with up-to-date information on the project. Complete: The project webpage was created and updated regularly with the project status and additional materials.
News Alerts [DPH A4d] Optional Evidence that subscriber alerts have occurred Complete: Subscribers were alerted via email 5 days before each Board meeting, with links to the agenda, papers and the option to dial in to observe the discussion. A News Alert was also issued, alerting subscribers to the Draft Comment Letter publication.
Outreach
Outreach activities [DPH 5.11] Mandatory Gather input from investors, preparers and accounting firms and institutes as outlined in the PIP. Complete: More than 60 stakeholders, representing users of financial statements, preparers of financial statements, accounting firms and regulators were consulted during the project. Further detail can be found in the Feedback statement.
Preparation of Documents for public comment
DCL published for comment [DPH 5.13 to 5.17] Generally mandatory DCL published on website. Complete: The Secretariat published the approved DCL on the UKEB website for a 30-day comment period from 26 May 2023 to 26 June 2023.
Project finalisation and project closure
FCL submitted before comment period ends. [DPH 5.18] Mandatory Submitted before 10 March 2023 and published on UKEB website. The FCL was approved for issue at the Board meeting on 13 July 2023. FCL submitted to the IASB on 19 July 2023.
Feedback statement and due process compliance statement for influencing stage of project [DPH 5.19, 5.23-5.26] Mandatory This document and Feedback Statement published on website. The Secretariat published the Feedback Statement and Due Process Compliance Statement on the UKEB website on 19 July 2023.

Conclusion

This document sets out the main due process activities performed as part of the UKEB's due process to issue its comment letter on the Amendments.

This project complies with the applicable due process steps, as set out in the Handbook at the time of writing.

Appendix B: Due Process Compliance Statement: Amendments to IAS I Classification of Liabilities as Current or Non-current (Amendments to IAS 1) and Non-current Liabilities with Covenants (Amendments to IAS 1)

Title of the Amendment Issue dates
Classification of Liabilities as Current or Non-current (Amendments to IAS 1) (2020 Amendments) - Exposure Draft ED/2015/1 published on 10/02/2015
- Final amendment published: 23/01/2020
Non-current Liabilities with Covenants (Amendments to IAS 1) (2022 Amendments) - Exposure Draft ED/2021/9 published on 19/11/2021
- Final amendment published: 31/10/2022

General UKEB requirements: The UKEB adopts international accounting standards for use within the UK, in accordance with SI 2019/685, and applies its own processes before it decides whether to adopt a new or amended international accounting standard.

Endorsement process

Step Mandatory/ optional¹ Metrics or evidence UKEB Secretariat comments
Work plan [Handbook 4.30(d)]
Technical project added to UKEB technical work plan Mandatory Project is included in the UKEB published technical work plan. Complete: The 2020 Amendments were included in the UKEB technical work plan published in December 2020. The 2022 Amendments were included in the UKEB technical work plan published in November 2022.
Project preparation [Handbook 6.12-6.16]
Project Initiation Plan (PIP) Mandatory PIP draft with project outline (background, scope, project objective) and approach for endorsement and adoption (key milestones and timing) proportionate to the project Complete: Taking a proportionate approach, the Secretariat included mandatory milestones for the project and considered, as appropriate, other milestones and activities. The PIP was approved at the 19 January 2023 Board meeting.
Mandatory Outreach plan for stakeholders and communication approach outlined Complete: Due to the narrow-scope of the Amendments, consultation activities were focused solely on obtaining responses to the Draft Endorsement Criteria Assessment (DECA) (as posted on the UKEB website).
Mandatory Resources allocated Complete: One project director supported by one project manager, with communications and economics team support.
Mandatory Assessment of whether to set up an ad-hoc advisory group Complete: Assessed. Taking a proportionate approach, an ad-hoc advisory group was not considered necessary due to the narrow-scope of the Amendments.
Mandatory UKEB Board public meeting held to approve PIP Complete: PIP approved at the 19 January 2023 Board meeting.
Optional UKEB education or initial assessment Complete: While an education session was not provided to the Board, the Board was given an update on the project at the November 2022 Board meeting covering background information on the Exposure Draft (ED) proposals and on the UKEB Final Comment Letter (FCL) to the 2022 Amendments, including an update on the IASB's subsequent redeliberations.
Communications
Public board meetings [Handbook 4.10] Mandatory UKEB Board public meetings held to discuss technical project Complete. The Secretariat gave an update to the Board at the November 2022 meeting.
19 January 2023: the Board approved the PIP.
23 February 2023: the Board reviewed and approved the DECA for consultation.
22 June 2023: the Board discussed the formal responses received for DECA.
13 July 2023: Approval of the Adoption Package consisting of:
• Final Endorsement Criteria Assessment (ECA);
• Feedback Statement;
• [Draft] Due Process Compliance Statement; and
• [Draft] Adoption Statement for the Amendments
Secretariat papers [Handbook 4.20] Mandatory Board meeting papers posted and publicly available on a timely basis. Complete: The UKEB meeting papers were published on the UKEB website one week before the relevant public meetings and subscribers notified via UKEB News Alerts. Meeting minutes and recordings were made publicly available via the UKEB website. Subscribers were notified via UKEB News Alerts.
Project website [Handbook 4.25(b)] Mandatory Project website contains a project description with up-to-date information on the project. Complete: A project webpage including a project description was created. It was updated regularly with project status and additional materials.
Mandatory Update UKEB website Complete: Project webpage updated regularly, and News Alerts issued to subscribers with latest status and documents.
Alerts [Handbook 4.24] Mandatory Evidence that subscriber alerts have occurred Complete: Subscribers were alerted via email 5 days before each Board meeting with links to the agenda, papers and the option to dial in to observe the discussion. News Alerts were also issued, alerting subscribers to the DECA publication.
Mandatory Project email address publication and adoption of the Amendments A general UKEB email address was used for outreach and correspondence purposes throughout the duration of the project.
Desk-based research [Handbook 6.17]
Optional Identify relevant research sources and documents Complete: The Secretariat has reviewed:
• The IASB's work on the Amendments (mainly staff papers and the IFRIC Agenda Decision including discussion with IASB staff)
• The Big 4 accounting manuals and separate publications on the Amendments for any guidance and illustrative examples
• The IASB's Basis for Conclusions and Dissenting Opinion
• Comment letters on the ED received by the IASB from UK stakeholders including the UKEB
• Previous work done by the Secretariat (FCL, Feedback Statement, comment letters on our DCL)
Outreach activities [Handbook 6.18-6.22]
Consult with a representative range of stakeholders prior to adoption Mandatory Evidence of consultation Complete: Due to the narrow-scope of the Amendments, consultation activities were focused on obtaining responses to the Draft Endorsement Criteria Assessment (DECA). The UKEB received eight comment letters. Comment letters are available on the UKEB website.
Draft Endorsement Criteria Assessment (DECA) [Handbook 6.23-6.29]
Mandatory UKEB sets comment period for response on DECA (generally not less than 90 days) Complete: At 19 January 2023 Board meeting the Board decided that the comment period for public consultation should be no less than 90 days and approved the overall project plan. The DECA was published for consultation on 9 March 2023 (comment period deadline 8 June 2023).
Mandatory Review and approval at UKEB public meeting Complete: Approved at 23 February 2023 Board meeting.
Mandatory DECA posted on website for public consultation Complete: The Secretariat published the approved DECA and Invitation to Comment on the UKEB website for a 91-day consultation period from 9 March 2023 to 8 June 2023.
Mandatory News Alert to announce publication Complete: News Alert posted on 9 March 2023 and 31 May 2023 calling for comments and link to the DECA was sent out to UKEB advisory groups.
Project closure [Handbook 6.30-6.48]
Final Endorsement Criteria Assessment (ECA) Mandatory Public responses on DECA assessed and posted on website Complete: The UKEB received eight comment letters which were published on the UKEB website. All responses were assessed, reflected as appropriate in the ECA and summarised in the feedback statement.
Mandatory Final ECA approved by UKEB in public meeting Complete: A draft of the ECA was presented for approval to the Board at its July 2023 public meeting. The Board approved final ECA, subject to suggested amendments.
Mandatory Publish final ECA on UKEB website Complete: Final ECA published on 24 July 2023.
Feedback statement Mandatory Feedback statement approved by UKEB in public meeting Complete: A draft of the feedback statement was presented for approval to the Board at its July 2023 public meeting. The Board approved the final feedback statement, subject to suggested amendments.
Mandatory Feedback statement posted on UKEB Website Complete: Final feedback statement published on 24 July 2023.
Mandatory News Alert published to announce publication Complete: News Alerts announcing the adoption of the Amendments published on 24 July 2023.
Due Process Compliance Statement (DPCS) [Handbook 6.37 to 6.39] Mandatory Due Process Compliance Statement approved by UKEB in public meeting Complete: A [draft] DPCS was presented for approval to the Board at its July 2023 public meeting. The final DPCS presented for noting at the Board's September 2023 meeting.
Mandatory Due Process Compliance Statement posted on UKEB Website Complete: The final DPCS published on the UKEB website subsequent to the September 2023 Board meeting.
Adoption Statement [Handbook 6.40 to 6.48] Mandatory Adoption statements approved by UKEB in public meeting Complete: Adoption statement for the Amendments was presented for approval to the Board at its July 2023 public meeting subject to editorial amendments.
Mandatory Adoption statements posted on UKEB Website Complete: The final Adoption Statement for the Amendments published on 24 July 2023.
Mandatory News Alert published to announce publication Complete: News Alert announcing adoption of the Amendments published on 24 July 2023.
Voting on adoption of the Amendments [Handbook 6.42 to 6.48] Mandatory Tentative vote Complete: Tentative vote took place at the July Board meeting based on the discussion of the 'adoption package', which includes a draft final ECA, a draft feedback statement, the DPCS, a draft adoption statement for the Amendments; and the text of the UK-adopted international accounting standard (Amendments to IAS 1). Vote was indicative only.
Mandatory Evidence of written vote (in paper or electronic form) Complete: Adoption statement and voting forms sent to the Board for voting (accompanied by the text of the Amendments to be adopted) on 14/7/23 (written forms due by 21/7/23). Vote formalised via Board members signing the formal voting forms for the Amendments.
Mandatory News Alert published to announce the outcome of the vote within 3 working days of the formal vote Complete: News Alert announcing the adoption of the Amendments published on 24 July 2023.

Conclusion

This document sets out the main due process activities performed as part of the UKEB's project to endorse the Amendments. Overall, this project complies with the applicable due process steps, as set out in the Handbook at the time of writing.

Appendix C: Due Process Compliance Statement: International Tax Reform – Pillar Two Model Rules (Amendments to IAS 12)

Title of the Amendments Issue dates
International Tax Reform–Pillar Two Model Rules (Amendments to IAS 12) - Exposure Draft ED/2023/01 published on 9 January 2023
- Final amendments published 23 May 2023
- Temporary mandatory exception effective immediately and retrospectively; targeted disclosure requirements effective for annual periods beginning on or after 1 January 2023.

General UKEB requirements: The UKEB adopts international accounting standards for use within the UK, in accordance with SI 2019/685, and applies its own processes before it decides to endorse and adopt a new or amended international accounting standard.

Endorsement process

Step Mandatory / optional¹ Metrics or evidence UKEB Secretariat comments
Project preparation
Added to UKEB technical work plan [Due Process Handbook (Handbook) [4.29]] Mandatory Project is included in the UKEB published technical work plan. Complete: the Amendments were included in the UKEB technical work plan published in December 2022.
Project preparation (continued)
Project Initiation Plan (PIP) [Handbook 6.12 to 6.16] Mandatory PIP draft with project outline (background, scope, project objective) and approach for endorsement (key milestones and timing) proportionate to the project Complete: taking a proportionate approach, the Secretariat included mandatory milestones for the project and considered, as appropriate, other milestones and activities. The PIP was approved at the 23 February 2023 Board meeting. The PIP combined the influencing and endorsement phases of the project, as this was an urgent project run to a tight timetable.
Mandatory Outreach plan for stakeholders and communication approach outlined Complete: Due to the narrow-scope nature of the Amendments, consultation activities were focused on obtaining responses to the Draft Endorsement Criteria Assessment (DECA) as well as consulting with advisory groups on the balance of costs and benefits of the Amendments.
Mandatory Resources allocated Complete: one project manager supported and overseen by one senior project director, with communications and economics team support.
Mandatory Assessment of whether to set up an ad-hoc advisory group Complete: assessed. Taking a proportionate approach, an ad-hoc advisory group was not considered necessary due to the narrow scope nature of the Amendments.
Mandatory UKEB Board public meeting held to approve PIP Complete: the PIP was approved at the 23 February 2023 Board meeting.
Optional UKEB education or initial assessment Complete: The Board was provided with an update on the project at the 27 April 2023 Board meeting, which covered the IASB's 11 April 2023 discussion and its tentative decisions taken on the IASB staff proposals in the light of feedback received on the Exposure Draft.
Communications
Public board meetings [Handbook 4.10] Mandatory UKEB public meetings held to discuss technical project Complete: The Board approved the Project Initiation Plan (PIP) at its 23 February 2023 meeting. It approved the draft ECA for consultation at its 22 June meeting. The Board approved the Adoption Package, consisting of the final Endorsement Criteria Assessment (ECA), the Feedback Statement, the [draft] Due Process Compliance Statement and the Adoption Statement for the Amendments, at its meeting on 13 July 2023.
Communications (continued)
Secretariat papers [Handbook 4.20] Mandatory Board meeting papers posted and publicly available on a timely basis. Complete: The UKEB's June meeting papers were published on the UKEB website one week before the public meetings. Meeting minutes and recordings were made publicly available via the UKEB website. Subscribers were notified via the UKEB News Alerts. However, to ensure the Board could reach an adoption decision in sufficient time to permit preparers with June interims to use the temporary mandatory exception from deferred tax accounting in relation to Pillar Two if the Amendments were adopted, the Board sanctioned a shortened (14-day) comment period for the draft comment letter (DCL) from 26 June 2023 to 10 July 2023. In accordance with handbook paragraph 4.20, the delivery of a late paper to the 13 July meeting was agreed in public at the 23 February 2023 Board meeting.
Project webpage [Handbook 4.25(b)] Mandatory Update UKEB website Complete: The project webpage has been updated regularly on a timely basis.
Subscriber alerts [Handbook 4.24] Mandatory Evidence that subscriber alerts have occurred Complete: Subscribers were alerted via email 5 days before each Board meeting, with links to the agenda, papers and the option to dial in to observe the discussion. A News Alert was issued, alerting subscribers to the publication of the DECA. As agreed by the Board, for the 13 July meeting, subscribers were alerted to the meeting and agenda 5 days beforehand and to the fact that papers would be issued no later than Tuesday 11 July (2 days before the meeting).
Desk-based research
Desk-based research [Handbook 6.17] Optional Review of relevant documentation Complete: the Secretariat has reviewed:
• The IASB's work on the Amendments (staff papers, ED);
• The Basis for Conclusions to the ED and Dissenting Opinion;
• Comment letters on the ED received by the IASB from UK stakeholders including the UKEB;
• Other standard-setters' views; and
• Accounting manuals and press releases for guidance and illustrative examples.
Outreach
Consult with a representative range of stakeholders prior to adoption [Handbook 6.18 to 6.21] Mandatory Evidence of consultation Due to the narrow-scope nature of the Amendments, consultation activities were focused on consultation with advisory groups and obtaining responses to the Draft Endorsement Criteria Assessment (DECA). The UKEB received seven comment letters. The comment letters received were published on the UKEB website.
Draft Endorsement Criteria Assessment (DECA)
DECA [6.23 to 6.29] Mandatory UKEB sets comment period for response of DECA Complete: Given the urgency of the Amendments, at its 23 February 2023 meeting, the Board decided that the comment period for public consultation should be 14 days and approved the overall project plan, subject to confirmation by the 28 March 2023 meeting of the Preparer Advisory Group and the 30 March 2023 meeting of the Accounting Firms and Institutes Advisory Group that their previous advice, i.e. that an accelerated timetable was required, had not changed. Both groups confirmed that their advice remained the same. The DECA was published for consultation on 26 June 2023 (comment period deadline: 10 July 2023).
Draft Endorsement Criteria Assessment (DECA) (continued)
DECA [6.23 to 6.29] (continued) Mandatory Review and approval at the UKEB public meeting Complete: Reviewed and approved at the Board meeting on 22 June 2023.
Mandatory DECA posted on website for public consultation Complete: The Secretariat published the approved DECA and Invitation to Comment on the UKEB website for a 14-day consultation period from 26 June 2023 to 10 July 2023.
Mandatory News Alert to announce publication Complete: A News Alert was published on 26 June 2023 calling for comments. A link to the DECA was sent out to the UKEB advisory groups.
Project finalisation and project closure
Final Endorsement Criteria Assessment (ECA) [Handbook 4.25(e)] Mandatory Public responses on DECA assessed and posted on website Complete: The UKEB received 7 comment letters which were published on the UKEB website. All responses were assessed, reflected as appropriate in the final ECA and summarised in the Feedback Statement.
Project finalisation and project closure (continued)
Final Endorsement Criteria Assessment (ECA) [Handbook 6.40 to 6.48] (continued) Mandatory Final ECA approved by the UKEB in public meeting Complete: A draft of the final ECA was presented for approval to the Board at its 13 July 2023 public meeting. The Board approved the final ECA, subject to suggested amendments.
Mandatory Publish final ECA on the UKEB website Complete: The final ECA was published on the UKEB website on 19 July 2023.
Feedback Statement [Handbook 6.33 to 6.48] Mandatory Feedback Statement approved by the UKEB in a public meeting Complete: A draft of the Feedback Statement was presented for approval to the Board at its 13 July 2023 public meeting. The Board approved the final Feedback Statement, subject to editorial changes.
Mandatory Feedback Statement posted on the UKEB website Complete: The final Feedback Statement was published on the UKEB website on 19 July 2023.
Mandatory News alert published to announce publication Complete: A News Alert announcing publication of the Feedback Statement was published on 19 July 2023.
Due Process Compliance Statement (DPCS) [Handbook 6.37 to 6.39] Mandatory DPCS approved by the UKEB in public meeting Complete: A [draft] DPCS was presented for approval to the Board at its 13 July 2023 public meeting. [A final DPCS was presented for noting at the Board's 21 September 2023 meeting.]
Mandatory DPCS posted on the UKEB website Complete: The final DPCS was published on the UKEB website after the September 2023 Board meeting.
Adoption Statement [Handbook 6.40 to 6.48] Mandatory Adoption Statement approved by the UKEB in public meeting Complete: The Adoption Statement for the Amendments was approved by the Board at its 13 July 2023 public meeting subject to editorial amendments.
Mandatory Adoption Statement posted on the UKEB website Complete: The final Adoption Statement for the Amendments was published on 19 July 2023.
Mandatory News Alert published to announce publication Complete: The News Alert announcing adoption of the Amendments was published on 19 July 2023.
Voting on adoption of the Amendments [Handbook 6.42 to 6.48] Mandatory Tentative vote Complete: A tentative vote took place at the 13 July Board meeting based on the discussion of the Adoption Package, which included the final draft ECA, the Feedback Statement, the DPCS, the draft Adoption Statement for the Amendments and the text of the UK-adopted international accounting standard International Tax Reform–Pillar Two Model Rules (Amendments to IAS 12). The vote was indicative only.
Mandatory Evidence of written vote (in paper or electronic form) Complete: The Adoption Statement and voting forms were sent to the Board for voting (accompanied by the text of the Amendments to be adopted) on 14 July 2023 (written forms due by 19 July 2023). The vote was formalised via Board members signing the formal voting forms for the Amendments.
Mandatory News Alert published to announce the outcome of the vote within 3 working days of the formal vote Complete: The News Alert announcing adoption of the Amendments was published on 19 July 2023.

Conclusion

This document sets out the main due process activities performed as part of the UKEB's project to endorse the Amendments. To meet the timeline for endorsement required by stakeholders, the DECA was issued for a 14-day comment period, which complies with the requirement set out in the Handbook paragraph 6.29.

In the Board's opinion, overall, this project complies with the applicable due process steps, as set out in the Handbook at the time of writing.

Appendix D: ISSB Request for Information (RFI) Consultation on Agenda Priorities - Due Process Compliance Statement

Influencing process: ISSB RFI Consultation on Agenda Priorities

Step Mandatory/ Optional¹ Metrics or evidence UKEB Secretariat comments
ISSB's due process document
ISSB RFI Mandatory Published: 04/05/2023 Comment deadline: 01/09/2023 n/a
Project preparation
Technical project added to UKEB technical work plan [Due Process Handbook (Handbook) 4.30(b)] Mandatory Project is included in the UKEB published technical UKEB Work Plan Included in the UKEB technical work plan published in May 2023.
Project Initiation Plan (PIP) [Handbook 5.4 to 5.8 and 5.13 to 5.14] Mandatory PIP draft with project outline (background, scope, project objective) and approach for influencing (key milestones and timing) proportionate to the project The Secretariat included mandatory milestones for the project and considered, as appropriate, other milestones and activities. The PIP was approved by UKEB at 18/05/23 meeting.
proportionate to the project
Outreach plan for stakeholders and communication approach outlined Engagement with UKEB Advisory and Working Groups on both the ISSB RFI and the Draft Comment Letter (DCL). The Secretariat also proposed a round table discussion with the UKEB Sustainability Working Group. Engagement on the DCL with industry and user representative bodies.
Resources allocated Two project directors and an assistant project manager.
Project Initiation Plan (PIP) [Handbook 5.4 to 5.8 and 5.13 to 5.14] (continued) Mandatory Assessment of whether to set up an ad-hoc advisory group The UKEB Sustainability Working Group had already been established.
PIP is approved at public meeting [Handbook 5.4] Mandatory UKEB Board public meeting held to approve PIP Approved at 18/05/23 UKEB public board meeting.
Education sessions [Handbook 4.10] Optional UKEB Education or initial assessment n/a
Desk-based research [Handbook 5.9] Optional Review of relevant documentation The following research was developed and considered:
• UKEB research reports
i. Climate-Related Matters Summary of Connectivity Research
ii. Analysis of 2022 Annual Reports
• UKEB staff connectivity papers
i. Asset recognition, measurement, and impairment
ii. Liabilities and Provisions
iii. Fair Value Measurement
• Discussion with the UKEB National Standard Setters Sustainability Forum 2
Communications
Public board meetings Mandatory UKEB Board public meetings held to discuss technical project PIP approved at 18/05/23 Board meeting. DCL approved at 22/06/23 Board meeting. Final Comment Letter approved at 2/08/23 Board meeting
Secretariat papers Mandatory UKEB Board meeting papers posted and made publicly available on a timely basis. UKEB Board meeting papers were published on the UKEB website one week before the public meetings. Meeting minutes and recordings were made publicly available via the UKEB website. Advisory and Working Group minutes were made publicly available on the UKEB website. Subscribers were notified via the UKEB LinkedIn posts and News Alerts.
Project webpage Optional Project webpage contains a project description with up-to-date information on the project The project webpage was created in May 2023. It was updated regularly with the project status and additional materials.
News Alerts [Handbook A4d] Optional Evidence that subscriber alerts have occurred Subscribers were alerted, via email, 5 days before each Board meeting, provided with links to the agenda, papers and given the option to dial in to observe the discussion. News Alerts were also issued alerting subscribers to the UKEB Consultation on its DCL for ISSB RFI and publication of the Final Comment Letter.
Outreach activities
Outreach activities [Handbook 5.11 - examples of outreach activities included at A4 and of fieldwork, a subset of outreach, at A7] Mandatory Gather input from investors, preparers and accounting firms and institutes, as outlined in the PIP. Activities included:
• Obtaining input from a roundtable discussion of the UKEB Sustainability Working Group on 29 June 2023 3;
• Obtaining input from UKEB Advisory Group members;
• Requesting feedback via an Invitation to Comment document via the UKEB website; and
• Obtaining feedback from The Investment Association, UK Finance and the Association of British Insurers.
UKEB Draft Comment Letter
Draft comment letter (generally mandatory) [Handbook paragraphs 5.13 to 5.17] Mandatory Draft comment letter approved for publication at UKEB Board public meeting The DCL was approved at the UKEB Board meeting on 22/06/23.
Mandatory Draft comment letter, including deadline for responses, posted on UKEB Website for public consultation The DCL was published on 23/06/23 for a 30-day public comment period, ending on 23/07/23.
Mandatory News Alert issued to announce publication of the DCL DCL publication announced via a UKEB News Alert on 23/06/03.
[Handbook paragraphs 5.19 and 5.23] Public responses on draft comment letter posted on website Five comment letters were received from CFA UK, Emerging Technologies Sustainability Taskforce, KPMG, PwC and an individual were all published on the project web page on the UKEB website.
UKEB final comment letter
Final comment letter (FCL) submitted before comment period ends. [Handbook paragraph 5.18] Mandatory Final comment letter approved for publication at UKEB Board public meeting The Final Comment Letter (FCL) was approved at the UKEB Board meeting on 2/08/23.
Mandatory Publish final comment letter on UKEB website and submit to ISSB The FCL was published on 11/08/23.
Mandatory News Alert issued to announce publication A news alert was published on 11/08/23.
Finalisation
Feedback statement [Handbook paragraphs 5.19 to 5.22] Mandatory Draft Feedback Statement for discussion and review at UKEB Board public meeting The Feedback Statement (FS) was approved at the UKEB Board meeting on 2/08/23.
Mandatory Feedback Statement posted on UKEB Website The FS was published on 11/08/23.
Mandatory News Alert issued to announce publication A news alert was published on 11/08/23.
Due process compliance Statement (DPCS) [Handbook paragraphs 5.23 to 5.26] Mandatory Due Process Compliance Statement approved by UKEB in public meeting A [draft] DPCS was presented for approval to the Board at its August 2023 public meeting. The final DPCS presented for noting at the Board's September 2023 meeting.
Mandatory Due Process Compliance Statement posted on UKEB Website The final DPCS published on the UKEB website subsequent to the September 2023 Board meeting.

Conclusion

This document sets out the main due process activities performed as part of the UKEB's project. Overall, this project complies with the applicable due process steps, as set out in the Handbook at the time of writing.

Appendix E: ISSB General Update

ISSB

July meeting

E1. The International Sustainability Standards Board (ISSB) met virtually 4 on 27 July 2023 to discuss the next steps for researching targeted enhancements to the ISSB Standards.

E2. The ISSB requested the staff to develop guidance for IFRS S2 Climate-related Disclosures in relation to 'climate adjacent' risks and opportunities. Staff will develop educational material regarding nature and the 'just transition' to a lower carbon economy.

E3. It was noted that, per the IFRS Foundation Due Process Handbook, neither educational material nor guidance would amend any requirements in IFRS S2.

E4. The ISSB will discuss the proposed educational material at a future meeting.

September meeting

E5. The ISSB will meet in Montreal, Canada on 14 September to discuss the International Applicability of SASB Standards. Staff have prepared a high-level PowerPoint summary of feedback from the public comment period for the methodology exposure draft 5.

E6. The presentation noted that the balance of feedback was supportive of the methodology and associated timeline. It was also noted that there are several additional actions for the SASB Board Advisory Group to consider outside the scope of the exposure draft and that next steps would be informed by the outcome of the Agenda Priorities consultation.

ISSB standards

E7. The International Organization of Securities Commissions (IOSCO) announced 6 its endorsement of both ISSB Standards.

E8. The ISSB published 7 the Proposed IFRS Sustainability Disclosure Taxonomy for public comment. The ISSB will review feedback on the proposals in the second half of 2023 and aims to issue the final digital taxonomy early in 2024.

E9. A webcast 8 by Linda Mezon-Hutter, Vice-Chair of the International Accounting Standards Board (IASB) and Sue Lloyd, Vice-Chair of the ISSB has been published which discusses connections between financial statements and sustainability-related financial disclosures and in the work of the two boards.

E10. Following the publication of European Sustainability Reporting Standards (ESRS), the European Commission, European Financial Reporting Advisory Group (EFRAG) and the ISSB provided an update 9 on their discussions around alignment and interoperability. The organisations noted that there is a 'very high degree of alignment, reduced complexity and duplication for entities wishing to apply both the ISSB Standards and ESRS'.

IFRS Foundation updates

E11. Following publication of the inaugural ISSB Standards IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2, the Financial Stability Board (FSB) requested the IFRS Foundation to take over the monitoring 10 of companies' progress on climate-related disclosures from the Task Force on Climate-related Financial Disclosures (TCFD).

E12. The IFRS Foundation has published 11 a comparison of the requirements in IFRS S2 and the TCFD recommendations. Companies that apply the ISSB Standards will now meet the TCFD recommendations.

E13. The Foundation also published a high-level roadmap 12 providing transparency around the IFRS Foundation and the ISSB's strategy to support jurisdictional adoption. The document is a precursor to an Adoption Guide 13 for regulators, which will be finalised later in 2023.

E14. On 4 September 2023, the Chair of the IFRS Foundation Trustees and the IASB and ISSB Chairs attended their annual meeting with the Committee on Economic and Monetary Affairs (ECON) of the European Parliament 14. Questions from Parliamentarians covered topics including: differences between ISSB standards and ESRS and the associated challenges and costs for EU companies; cooperation with EFRAG; whether ESG matters are reflected in ASB standards; and, whether there is a risk of overregulation.

UK updates

E15. The Financial Conduct Authority (FCA) announced a delay 15 to the publication of its policy statement on Sustainability Disclosure Requirements until the last quarter of the 2023.

E16. The Department for Business and Trade (DBT) announced that the Secretary of State for Business and Trade will consider the endorsement of the ISSB Sustainability Disclosure Standards 16 in the UK by July 2024.

E17. The Financial Reporting Council (FRC), in its role as Secretariat to the UK Sustainability Disclosure TAC, has issued 17 a call for evidence to inform the proposed endorsement of the IFRS Sustainability Disclosure Standards in the UK. The deadline to submit responses is 11 October 2023.

E18. The FRC Lab has published 18 a report titled “ESG Data Distribution and Consumption" examining how investors collect and use environmental, social and governance (ESG) data on companies.

E19. The FRC has also published a thematic review 19, which assesses the quality and maturity of climate-related metrics and targets disclosures.

E20. The Taskforce for Nature-related Disclosures (TNFD) intends to launch its final recommendations on 18 September 2023 20.

E21. The Transition Plan Taskforce (TPT) also plans to publish a final Disclosure Framework in October 2023 21. At the same time TPT will publish an initial version of the Implementation Guidance with a final version by February 2024.

International Updates

E22. The European Commission has issued 22 the European Sustainability Reporting Standards (ESRS) which come into effect in 2024. EFRAG has published 23 a mapping table that assesses the interoperability between ESRS 2 General Disclosures and ESRS E1 Climate and IFRS S1 & S2.

E23. EFRAG and GRI have published a joint statement confirming that have achieved a high level of interoperability 24 between their respective standards.

E24. Canadian Securities Administrators (CSA) indicated 25 that its staff intend to conduct further consultations with the Canadian Sustainability Standards Board (CSSB) to adopt disclosure standards based on ISSB Standards, with modifications considered necessary and appropriate in the Canadian context.

E25. The environmental law charity Client Earth has sent 26 a letter to the Global Public Policy Committee alleging that senior managers at the world's six largest accounting firms are failing to ensure that climate change is adequately addressed in financial reports and audits.

E26. The US Securities and Exchange Commission (SEC) may amend existing rules requiring organisations to make climate-related disclosures in their registration statements and annual reports. The revised requirements are now anticipated by October 27.

Appendix F: Intangibles research project – survey update

Executive Summary
Project Type Research
Project Scope Significant

Purpose of the paper

This paper provides an update to the Board on progress made by the Secretariat on the intangibles survey research.

Summary of the Issue

Following the publication of the intangibles qualitative research in March 2023, the Secretariat commenced work on the intangibles survey research. The following activities have been undertaken:

Questionnaire drafting

The Secretariat produced a first draft of the questionnaire drawing on the qualitative research findings and relevant literature on the topic. The draft questionnaire was tested and revised after input from:

  • Academic Advisory Group (AAG) meeting in April 2023.
  • Members of the AAG.
  • Some UKEB Board members.
  • Economists at DBT.
  • Senior members of the UKEB Secretariat

Pilot

A final questionnaire was then shared the Investor Advisory Group (IAG) in August 2023 as a pilot. The pilot is expected to complete in September 2023. To-date two responses have been received and no fatal flaws have been flagged.

Wider Distribution

In parallel, the Secretariat has networked and built contacts with investors and their representatives to achieve a wide distribution of the questionnaire. The launch is planned for the week commencing 25 September 2023. The questionnaire is planned to be open for three weeks. Distribution will happen through a variety of channels and aims to achieve a complete coverage of the different types of users' of financial statements in the UK. We are hoping that Board members will also share the survey with their contacts and encourage responses.

Data analysis and report drafting

The Secretariat will analyse the data upon receiving responses. Report drafting will follow. A draft report is anticipated for Q1 2024.

Sharing with other National Standard Setters

We have already received requests from other National Standard Setters to share the survey with them so they can carry out similar exercises in their own jurisdictions. We intend to share a version as soon as it is issued to UK stakeholders.
Decisions for the Board N/A
Recommendation N/A
Appendices N/A

Footnotes

Footnotes

  1. In accordance with the Due Process Handbook. ↩

  2. UKEB National Standard Setters Forum ↩

  3. UKEB Sustainability Working Group round table minutes (29 June 2023) ↩

  4. ISSB Update July 2023 Foundational Work–Researching targeted enhancements to ISSB Standards–Path forward Agenda reference: 9 ↩

  5. International Applicability of SASB Standards - Project update: results of recent comment period ↩

  6. IFRS Sustainability Disclosure Standards endorsed by international securities regulators ↩

  7. ISSB consults on proposed digital taxonomy to improve global accessibility and comparability of sustainability information ↩

  8. Webcast on connections between accounting and sustainability disclosures ↩

  9. European Commission, EFRAG and ISSB confirm high degree of climate-disclosure alignment ↩

  10. IFRS Foundation welcomes culmination of TCFD work and transfer of TCFD monitoring responsibilities to ISSB from 2024 ↩

  11. IFRS Foundation publishes comparison of IFRS S2 with the TCFD Recommendations ↩

  12. Cover note: Adoption Guide overview ↩

  13. The jurisdictional journey towards implementing IFRS S1 and IFRS S2 –Adoption Guide overview ↩

  14. Annual ECON exchange of views with representatives of the IFRS Foundation ↩

  15. FCA delays SDR until Q4 this year ↩

  16. Guidance UK Sustainability Disclosure Standards ↩

  17. UK Sustainability Disclosure TAC issues call for evidence ↩

  18. FRC Lab publishes report on ESG data use and distribution ↩

  19. FRC thematic review examines quality of climate-related metrics and targets disclosures ↩

  20. TNFD Recommendations Launch Webinar ↩

  21. Building momentum for transition plans ↩

  22. The Commission adopts the European Sustainability Reporting Standards ↩

  23. Interoperability between ESRS and ISSB standards EFRAG assessment at this stage and mapping table ↩

  24. EFRAG-GRI Joint Statement of Interoperability ↩

  25. The New ISSB Climate Standards: Stay Tuned For Made-In-Canada Rules ↩

  26. Accounting firms accused of missing climate risks in company audits ↩

  27. Explainer: What to expect once the SEC sets its final climate disclosure rules ↩