9 IASB General Update
15 July 2025 Agenda Paper 9
Executive Summary
| Project Stage | |
|---|---|
| Project Type | Influencing |
| Project Scope | Various |
Purpose of the paper
This paper provides the Board with an update on projects the Secretariat is currently monitoring, including the work of the IFRS Interpretations Committee.
As agreed with the Board, the Secretariat monitors projects being undertaken by the IASB and IFRS Interpretations Committee. This is undertaken to inform the Board about the progress and decisions being made by the IASB on active projects. Discussion by the Board may also help inform interactions with international standard setter meetings, including the IASB's Accounting Standards Advisory Forum (ASAF).
Summary of the Issue
This paper includes topics discussed by the IASB at its June 2025 meeting[^1].
Topic for discussion
- Amortised Cost Measurement
Topics for noting
- Intangible Assets
- Climate-related and Other Uncertainties in the Financial Statements
- Management Commentary
- IFRIC update
Decisions and questions for the Board
Topic for discussion
Amortised Cost Measurement (Appendix A) 1. Do Board Members have any questions or comments on the information about the IASB's Amortised Cost Measurement project presented in Appendix A?
Topics for noting 2. Do Board Members have any comments or questions on the topics for noting?
IFRIC Update There are no questions for the Board this month.
Recommendation N/A
Appendices
- Appendix A: Amortised Cost Measurement
- Appendix B: Intangible Assets
- Appendix C: Climate-related and Other Uncertainties in the Financial Statements
- Appendix D: Management Commentary
- Appendix E: Interpretations Committee update
- Appendix F: List of IASB projects
Appendix A: Amortised Cost Measurement
| Project Stage | ||||||
|---|---|---|---|---|---|---|
| IASB | Research / Pipeline | Discussion | Redeliberation | Exposure Draft | Redeliberation | Final standard |
| Post Implementation Review | ||||||
| UKEB | Research / | Research / | Monitoring | Influencing | Monitoring | Endorsement |
| Influencing | Influencing | |||||
| Influencing |
IASB Next Milestone:
- Technical deliberations expected Q3 2025 – Q1 2026.
- Exposure Draft 2026.
Overview
A1. In June 2025, the IASB was presented with an analysis of feedback from stakeholders, particularly preparers, about root causes of diversity in the application of the amortised cost measurement requirements of IFRS 9 Financial Instruments.
A2. At that meeting, the IASB decided to move the Amortised Cost Measurement project from its research programme to its standard-setting programme.
A3. The purpose of this paper is to provide the Board with an update on these matters.
Background
A4. At its September 2024 meeting, the IASB commenced its research project Amortised Cost Measurement[^1].
A5. In November and December 2024, the IASB sought feedback on the project objectives, approach and scope from consultative groups[^2]. Consultative groups were broadly supportive of the project objectives and approach but, in line with the IASB's own discussions, stressed the importance of identifying the root causes of diversity in practice by consulting with preparers[^3]. It was expected that this information would assist the IASB in understanding whether application issues were capable of being resolved through standard-setting[^4] and, if so, to identify potential solutions.
Preparer outreach
A6. Between March and May 2025, the IASB performed outreach, particularly with preparers, in different industries and across different geographic regions[^5]. This outreach includes feedback from the UKEB's Financial Instruments Working Group meeting on 1 April 2025.
A7. The IASB's outreach was directed at identifying the root causes of diversity of application, and focused on three main topics:
- calculating the effective interest rate on initial recognition (“topic 1”[^6]);
- subsequent changes to the effective interest rate, including the application of paragraphs B5.4.5 and B5.4.6 of IFRS 9 (“topic 2”[^7]); and
- modification of financial instruments (“topic 3”[^8]).
A8. Some outreach participants also highlighted application challenges in determining “the boundaries between modification, derecognition (including write-off), and impairment.”[^9]
A9. The results of the IASB’s outreach confirmed that there is significant diversity in practice in the application of the amortised cost measurement requirements.
A10. In respect of topic 1 (calculating the effective interest rate on initial recognition), it is considered that IFRS 9 contains clear requirements. Diversity in application mainly arises because reporting entities either make materiality judgements or have insufficient information available to make a reliable estimate, or “have developed ‘simplified’ accounting policies that align with their system capabilities.”[^10] Most IASB members who expressed views at the meeting agreed with the IASB staff analysis that, given the diversity in practice is not caused by IFRS 9, amending the Standard would be unlikely to bring any meaningful change in practice or significant improvements in financial reporting[^11].
A11. In respect of the other topics discussed in the outreach (i.e. topics 2 and 3), feedback suggests that diversity in practice arises from a lack of explicit requirements or application guidance in IFRS 9.
A12. Some outreach participants raised concerns that the benefits of reducing diversity in practice might not outweigh costs, if this disturbed long standing practices employed by entities, which are embedded in their accounting and other systems.[^12]
A13. IASB members who expressed views at the meeting supported further exploration of topics 2 and 3 as part of this project.
Standard-setting
A14. The June 2025 IASB Agenda Paper 11 concluded that the IASB has sufficient information about the problem to move forward, and recommended that the IASB adds the project to its standard-setting programme. The IASB staff also recommended that the IASB has sufficient information to proceed directly to an exposure draft in the future (i.e. without first publishing a discussion paper)[^13].
A15. At its June 2025 meeting, the IASB agreed to move the project from the research programme to the standard-setting work plan.
Next steps
A16. The indicative project timeline for the IASB's deliberations is presented below:
| Area | Topic (Items in bold are prioritised by consultative groups—see Feb.2025 IASB staff paper 11, paragraph 22) | Indicative timeline |
|---|---|---|
| Changes in expected cash flows that affect the EIR | Determining EIR with conditions attached to the contractual interest rate | Q3 2025 (*) |
| Accounting for subsequent changes in estimated cash flows | ||
| The effect of modifications on EIR | What constitutes a 'modification' of financial instruments | Q4 2025 |
| Changes in expected cash flows that affect the carrying amount | Assessment of modifications that lead to derecognition | |
| Partial derecognition vs modification of a financial instrument | ||
| Accounting for modification gains or losses | ||
| Accounting for unamortised transaction costs and fees received in modifications | ||
| Accounting for 'fees and costs incurred' as required by paragraph 5.4.3 of IFRS 9 | ||
| Boundaries between modification, derecognition, and impairment | Boundaries between modification, derecognition, and impairment | Q1 2026 |
| The IASB to reconsider whether it can solve the issues relating to accounting for write-offs effectively and efficiently. | Q1 2026 |
Source: based on Paragraph 50 of the February 2025 IASB Agenda Paper 11
(*) This has been updated by the UKEB Secretariat to reflect the latest status (as per the IASB June 2025 meeting). The original timeline published by the IASB in February 2025 stated Q2/Q3 2025 for this item.
A17. The UKEB Secretariat will continue to monitor project developments.
Question for the Board
1. Do Board members have any questions or comments on the information about the IASB's Amortised Cost Measurement project presented in this Appendix?
Appendix B: Intangible Assets – IASB Update
Background
B1. Following the Third Agenda Consultation in 2022, the IASB added a project on intangible assets to its research pipeline to comprehensively review the requirements in IAS 38 Intangible Assets. The IASB commenced the project in April 2024.
B2. At its May 2025 meeting the IASB tentatively decided the objectives of the project are to:
- “improve the usefulness of information entities provide about intangible items in their financial statements; and
- update IAS 38 Intangible Assets, in particular to make it more suitable for newer types of intangible items and new ways of using them.”[^1]
B3. At the same meeting the IASB decided to begin work on the project by exploring two initial streams in parallel:
- “assessing user needs for information about recognised and unrecognised intangible assets and expenditure associated with them in the financial statements; and
- considering whether to update the definition of an intangible asset, associated guidance and some aspects of the recognition criteria, by initially using, as test cases, application issues related to newer types of intangible assets and new ways of using them; and then considering the effects of any potential amendments on the broader population of intangible assets.”[^2]
IASB June 2025 discussion
Project plan
B4. At its June 2025 meeting the IASB discussed the project plan for exploring the initial streams of work (paragraph B3) in the Intangible Assets project over the next twelve months.
B5. The IASB staff propose:
- Q3 2025: Identifying test cases; developing outreach strategy and materials; desktop research.
- Q4 2025: Consulting stakeholders (including ASAF in October and December).
- Q1 2026: Analysing themes from consultations; developing solutions for test cases; reporting back to the IASB.
- Q2 2026: IASB to discuss solutions to test cases; consultation with ASAF in June.
- H2 2026: IASB to reflect on: way forward on user information needs; potential solutions to case studies; and effects on future intangibles work.
IASB observations during the meeting
B6. There was general agreement from the IASB on the importance of further research, based on interviews, to better understand user needs. It was also suggested that the IASB's test cases should be part of those interviews.
B7. There was also a call for more research to identify current good practices in financial reports for intangible assets. These may be an opportunity for standard-setting to capture this good practice.
B8. A number of IASB members, along with the Chair, noted the work already done by National Standard Setters (NSS) on intangibles. They encouraged the IASB staff to continue to engage with NSS.
Next steps
B9. The UKEB Secretariat will continue to monitor IASB discussions and work on intangibles. Updates will be provided as appropriate.
Appendix C: Climate-Related and Other Uncertainties in the Financial Statements (CROUFS)
| Project Stage | ||||||
|---|---|---|---|---|---|---|
| IASB | Research / Pipeline | Discussion | Redeliberation | Exposure Draft | Redeliberation | Final standard (n/a) |
| Post Implementation Review (n/a) | ||||||
| UKEB | Research / Influencing | Research / | Monitoring | Influencing | Monitoring | Endorsement (n/a) |
| Influencing (n/a) |
UKEB project page UKEB Final Comment Letter (published 3 December 2024)
Context
C1. At its June 2025 meeting, the IASB made decisions on the Climate-Related and Other Uncertainties in the Financial Statements (CROUFS) project direction and finalisation. This paper provides an update from that meeting and the next steps for the project.
Background
C2. The CROUFS Exposure Draft[^1] (ED) was published by the IASB in July 2024 and contained eight proposed illustrative examples (the examples) which were intended to accompany the relevant accounting standards.
C3. The examples proposed how an entity could apply the requirements in IFRS Accounting Standards to report the effects of climate-related and other uncertainties in its financial statements.
C4. The UKEB commented[^2] on the ED in the interest of ensuring connectivity and high-quality financial reporting. However, the UKEB will not endorse or adopt these examples for use in the UK, as they will not form part of the mandatory sections of IFRS Accounting Standards.
C5. The UKEB discussed the preliminary IASB staff recommendations in response to stakeholder feedback at its May 2025[^3] meeting and was provided with a further update at the June 2025[^4] meeting on the IASB's May 2025 deliberations. The June update also included the discussion at the ad-hoc Accounting Standards Advisory Forum (ASAF) May 2025 meeting.
June 2025 IASB CROUFS discussion and next steps
C1. The IASB made tentative decisions[^5] on the project's direction in response to feedback from stakeholders and from the May ASAF meeting. The key topics and conclusions from the meeting are noted below for information.
Connectivity
C2. The IASB tentatively agreed that feedback related to the priority of work to facilitate connected reporting would be sought as part of the IASB's Fourth Agenda Consultation.
Providing illustrative examples
C3. The IASB tentatively agreed that the examples would be provided as illustrative examples, published alongside the relevant international accounting standards and, in addition, as a single document.
Approach to developing the examples
C4. The IASB tentatively agreed that the project scope should not change i.e. to include 'other uncertainties'. It would be emphasised that the examples related to other uncertainties would be illustrated through climate-related uncertainties. No additional examples will be developed.
Proposed changes
Examples 1–4 and 6–8
C5. The IASB tentatively agreed to publish Examples 1–4 and 6–8 but some made suggestions for further amendments to the wording. Some IASB members expressed regret that the cross-reference to IAS 1 paragraph 17(c) had not been made in response to stakeholder feedback.
C6. The previous concern raised by an IASB member that the terminology in Example 8 (disaggregation) should be consistent with the disaggregation principles in IFRS 18 Presentation and Disclosure in the Financial Statements was reiterated. The IASB staff indicated that this point will be considered in drafting the example for publication.
Example 5
C7. The IASB tentatively agreed to withdraw Example 5. Some IASB members considered it should be retained as it was the only non-climate-related example.
Transition and effective date
C8. The IASB tentatively agreed that no effective date should be provided given that illustrative examples are non-mandatory guidance. Entities should be given 'sufficient time' to implement the examples. The term 'sufficient time' will not be explained further than the existing guidance in the IASB Due Process Handbook. The IASB Chair acknowledged that the messaging around this issue would be important.
Next steps
C9. The IASB anticipates publishing a near-final draft of the examples in July 2025. The final (seven) examples are anticipated to be published in October 2025. Two IASB members indicated that they may dissent, but that would depend on how their concerns were addressed by the staff in drafting and the nature of the communications for the publication of the examples.
C10. The UKEB Secretariat will continue to monitor the IASB's redeliberations and will provide further updates at future UKEB meetings.
Appendix D: Management Commentary
| Project Stage | ||||||
|---|---|---|---|---|---|---|
| IASB | Research / Pipeline | Discussion | Redeliberation | Exposure Draft | Redeliberation | Final standard (n/a) |
| Post Implementation Review (n/a) | ||||||
| UKEB | Research / Influencing | Research / | Monitoring | Influencing | Monitoring | Endorsement (n/a) |
| Influencing (n/a) |
Management Commentary project page
Context
D1. The Exposure Draft (the ED) updating IFRS Practice Statement 1 Management Commentary was published by the IASB in May 2021. In June 2024, the IASB decided to finalise the project by making targeted amendments to the proposals in the ED.
D2. The Practice Statement does not form part of the mandatory part of IFRS Accounting Standards and therefore will not be considered for adoption in the UK.
D3. As there are potential implications for connectivity with IFRS Accounting Standards, the UKEB is monitoring this project. The UKEB did not comment on the ED.
D4. At its December 2024 meeting[^1], the IASB made a series of tentative decisions to revise the ED based on stakeholder feedback. The IASB decided not to re-expose the proposals and to issue the revised Practice Statement.
D5. The revised Practice Statement and accompanying educational materials were published on 23 June 2025.
Revisions context
D6. Investors had advised the IASB of shortcomings in reporting under the previous version of the Practice Statement. These are[^2]:
- A lack of focus on matters important to a company's prospects, particularly in the long term.
- Too much generic information and not enough company-specific information.
- Information is fragmented and hard to reconcile to other information provided by a company.
- Information is unbalanced, incomplete or difficult to compare over time or between companies with similar activities.
D7. The revisions consider IFRS Sustainability Disclosure Standards and the Integrated Reporting Framework.
Content of the revised Practice Statement
D8. Compared to the 2010 Practice Statement, the revised version represents a major overhaul. The Practice Statement specifies an overall objective[^3] that companies shall provide information that:
- enhances users' understanding of the entity's financial performance and financial position reported in its financial statements; and
- provides management's insight into factors, including sustainability-related factors, that could affect the entity's ability to create value and generate cash flows across all time horizons, including in the long term.'
D9. The Statement specifies specific objectives across six areas[^4]:
- How the company's business model creates value and generates cash flows.
- Management's strategy for sustaining and developing the business model.
- The resources and relationships on which a) and b) depend.
- The risks of events or circumstances that could disrupt a), b) or c).
- How the external environment could affect a)–d).
- The company's financial performance and position reported in the financial statements.
Main changes from the ED
D10. The main changes from the ED are:
- Revisions to align the Practice Statement more closely with ISSB standards and the Integrated Reporting Framework.
- Amendments to clarify that governance matters are included in the scope of management commentary.
- Simplifying the structure of the disclosure objectives and removing disclosure requirements that formed a third level of content in the ED.
- Increasing emphasis on the link between materiality and key matters.
- Aligning terminology between the Practice Statement, the Conceptual Framework for Financial Reporting, IFRS Accounting Standards and IFRS Sustainability Disclosure Standards.
- Placing guidance on coherence in reporting in a separate chapter and emphasising coherence is between information in management commentary and general-purpose financial reporting, including financial statements and sustainability-related financial disclosures, if those are provided outside the management commentary.
Next steps
D11. The revised Practice Statement supersedes the 2010 version for annual reporting periods beginning on or after 23 June 2025. Early application is permitted.
Appendix E: Interpretations Committee Update
| UKEB Project Status: Monitoring | |
|---|---|
| IASB Next Milestone: N/A |
Background
E1. The UKEB's Due Process Handbook notes that the UKEB expects to respond to a limited number of tentative agenda decisions published by the IFRS Interpretations Committee (Interpretations Committee). Some factors to consider when deciding whether to respond may be:
- the degree of impact of the tentative agenda decision on UK companies (for example, in cases where the tentative agenda decision is expected to affect a significant number of UK companies);
- disagreement with the Interpretations Committee's analysis; or
- usefulness of the explanations and clarifications included in the tentative agenda decision.
E2. The Interpretations Committee met on 25 June 2025. The next Interpretations Committee meeting is on 16 to 17 September 2025.
Agenda decisions referencing IAS 1
E3. At its June 2025 meeting, the Interpretations Committee agreed to publish, subject to addressing Interpretation Committee members' comments, updates to ten agenda decisions that refer to, but do not focus only on, requirements in IAS 1 that were not brought forward unchanged to IFRS 18 or other IFRS Accounting Standards[^1] for public consultation with a comment period of 90 days. These have not been published at the time of writing this paper.
E4. At its June 2025 meeting, the Board decided that the UKEB should respond in support of the Interpretations Committee's proposed updates to the aforementioned ten agenda decisions[^2], assuming there are no substantive changes to the proposed updates above when they are published. The Secretariat plans to present for Board consideration a Project Initiation Plan and a Final Comment Letter at the UKEB's September 2025 meeting.
INTERPRETATIONS COMMITTEE AGENDA ITEMS
| MATTERS RECEIVED BUT NOT YET PRESENTED TO THE INTERPRETATIONS COMMITTEE[^3] | The content of this report starts after the cover page.
[^1] The topics not included in this month's update are:
- Brought forward to June 2025 meeting:
- Provisions
- Deferred to September 2025 meeting:
- Business Combinations - Disclosure, Goodwill and Impairment;
- Financial Instruments with Characteristics of Equity; and
- Equity Method