Response 5 - Standard Life

Call for comments on the Exposure Draft Amendments to the Fair Value Option for Investments in Associates and Joint Ventures

Deadline for completion of this Invitation to Comment:

Midday, Saturday 4 April 2026

Please submit to: [email protected]

Introduction

The objective of this Invitation to Comment is to obtain input from stakeholders on the UK Endorsement Board's (UKEB's) Draft Comment Letter (DCL) on the Exposure Draft (ED) Amendments to the Fair Value Option (IAS 28) published by the International Accounting Standards Board (IASB) on 19 February 2026. The IASB's comment period ends on 20 April 2026.

UK endorsement and adoption process

The UKEB is responsible for endorsement and adoption of IFRS for use in the UK and therefore is the UK's National Standard Setter for IFRS. The UKEB also leads the UK's engagement with the IFRS Foundation (Foundation) on the development of new standards, amendments and interpretations. This letter is intended to contribute to the IASB's due process. The views expressed by the UKEB in this letter are separate from, and will not necessarily affect the conclusions in, any endorsement and adoption assessment on new or amended International Accounting Standards undertaken by the UKEB.

Who should respond to this Invitation to Comment?

Stakeholders with an interest in the quality of accounts prepared in accordance with IFRS Standards.

How to respond to this Invitation to Comment

Please download this document, answer any questions on which you would like to provide views, and return it together with the 'Your Details' form to [email protected] by midday on Saturday 4 April 2026

Brief responses providing views on individual questions are welcome, as well as comprehensive responses to all questions.

Privacy and other policies

The data collected through responses to this document will be stored and processed by the UKEB. By submitting this document, you consent to the UKEB processing your data for the purposes of influencing the development of and adopting IFRS for use in the UK. For further information, please see our Privacy Statements and Notices and other Policies (e.g. Consultation Responses Policy and Data Protection Policy) ¹.

The UKEB's policy is to publish on its website all responses to formal consultations issued by the UKEB unless the respondent explicitly requests otherwise. A standard confidentiality statement in an e-mail message will not be regarded as a request for non-disclosure. If you do not wish your signature to be published, please provide the UKEB with an unsigned version of your submission. The UKEB prefers to publish responses that do not include a personal signature. Other than the name of the organisation/individual responding, information contained in the “Your Details” document will not be published. The UKEB does not edit personal information (such as telephone numbers, postal or e-mail addresses) from any other response document submitted; therefore, only information that you wish to be published should be submitted in such responses.

Questions

Scope of fair value option (IAS 28)

1The UKEB's draft comment letter (DCL) proposes rationalising the scope paragraph of the fair value option in IAS 28 to make it concise and principles-based. Do you agree with this position? Please explain why or why not.

We agree with the UKEB's proposal as it brings consistency in interpretation with IFRS 18.

2The UKEB's DCL raises a concern about ED paragraphs BC17 and BC18, which refer to the ability to revoke the fair value option in IAS 28, as they do not relate to the scope of the fair value option in IAS 28. Do you agree with this position? Please explain why or why not.

We agree that changes in requirement should be clearly incorporated in the main body of the Standard and not introduced through the Basis of Conclusions. We agree that there could be valid reasons to revoke the fair value option that are aligned with the IFRS Conceptual Framework. Given that IAS 28 is currently silent on whether this option is irrevocable, the introduction of positive guidance will enhance the usefulness of the application of the fair value option.

3The IASB's Exposure Draft includes an alternative view supporting opening the fair value option in IAS 28 to all entities. This is addressed in Appendix A, paragraph A3 of the DCL. Do you have any comments on the alternative view or our view in relation to it, as set out in Appendix A, paragraph A3 of the DCL?

We agree with the UKEB view that the alternative view has merits which should be explored. We recommend that this exploration is done outside this narrow scope amendment.

Other

4The UKEB's DCL supports the proposed amendments in relation to the effective date and transition. Do you agree with this position? Please explain why or why not.

We agree with the alignment with the introduction of IFRS 18 and the goal to achieve consistency between the two standards.

5Do you have any other comments on the IASB's Exposure Draft or the UKEB's DCL you would like to share?

The proposed changes to IAS 28 partially address the issue in IFRS 18, however they do not solve it entirely. It is our view that the income and expenses from a joint venture or associate for an entity whose main business activity is investing in assets should not be based on the measurement basis of the joint venture or associate. Instead, its classification should be based on whether it is held for operating or investment purposes. In the example of an insurer, the former would be to hold the associate/joint venture as an asset backing policyholder liabilities (operating in nature) or as a strategic investment for the latter purpose (investing in nature).

Response generation

6Did you/your organisation use a large language model (e.g. Chat GPT, Microsoft Copilot) to create any part of your/its response (response to this Invitation to Comment or a comment letter you are submitting as part of your response)?

7If you answered yes to Question 6, please specify which model and what prompt(s) you used for the large language model.

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Thank you for completing this Invitation to Comment

Please submit this document by midday on Saturday 4 April 2026 to [email protected]

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