Agenda Consultation Slide Deck

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15 July 2021 www.endorsement-board.uk/third-agenda-consultation

Email: [email protected]

The views expressed in this presentation are those of the presenter and not necessarily those of the UK Endorsement Board, nor are they necessarily reflective of any official policy or position.

Today's panellists

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Liz Murrall (Chair) Board member UK Endorsement Board

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Nick Anderson Board member IASB

Headshot of Rick Lacaille, a man with light brown hair, wearing a dark suit.

Rick Lacaille Global head of ESG State Street

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Pamela Taylor Associate Partner KPMG Department of Professional Practice

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Michelle O'Mara Group Technical Accounting Director Smith & Nephew

The views expressed in this presentation are those of the panellists and not necessarily those of their employer, nor are they necessarily reflective of any official policy or position.

Third Agenda Consultation: Objective and overview

IFRS® Foundation

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The views expressed in this presentation are those of the presenter, not necessarily those of the International Accounting Standards Board or the IFRS Foundation. Copyright © 2021 IFRS Foundation. All rights reserved.

Objective and timeline of the consultation

Objective To seek feedback on:

the strategic direction and balance of the Board's activities
the criteria for assessing the priority of financial reporting issues
the priority of financial reporting issues that could be added to the work plan

Timeline

March 2021 Published Request for Information for public comment

September 2021 End of comment period (27 September) New IASB Chair joins

Q4 2021 Start of Board deliberations

Q2 2022 Publication of the Feedback Statement

2022–2026 Board execution of activities and work plan

How this consultation compares with the Trustees' strategy review

Third Agenda Consultation Undertaken by the Board

To seek feedback that helps the Board prioritise activities within the current scope of the Board's work
The current scope of the Board's work is financial statements and management commentary for profit-oriented companies
Final decisions to be made by Q2 2022

Strategy Review Undertaken by the IFRS Foundation Trustees

To explore a potential expansion of the Foundation's role through the creation of a new Board to set sustainability reporting Standards
Final decisions to be made before the November 2021 United Nations COP26 conference

Trustees' decisions that affect the scope of the Board's work will be considered in finalising the Board's priorities and work plan

Overview of the Request for Information

Diagram illustrating key focus areas of IFRS Standards including new standards, maintenance, digital reporting, and SME standards, with stakeholder engagement, understandability, and accessibility at the core.

Elements for consideration:

Criteria for assessing the priority of financial reporting issues
Priority of financial reporting issues that could be added to the work plan
Strategic direction and balance of the Board's activities

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Helping stakeholders respond on the balance of activities

Current level of focus on each activity

Activity	Percentage
New IFRS Standards and major amendments to IFRS Standards	40%-45%
Maintenance and consistent application of IFRS Standards	15%-20%
The IFRS for SMEs Standard	5%
Digital financial reporting	5%
Understandability and accessibility	5%
Stakeholder engagement	20%-25%

Stakeholders have previously identified them as priorities
Re-prioritising could lead to inefficient starts and stops

Conduct required post-implementation reviews

IFRS 10, 11 and 12
IFRS 9
IFRS 15
IFRS 16

Undertake any time-sensitive projects

Urgent projects that may arise after this consultation
For example, the IBOR Reform projects that arose after the 2015 Agenda Consultation

Add new projects to the work plan

The IASB expects to add 2-3 large projects, or 4–5 medium-sized projects, or 7–8 small projects, if the IASB continues to spend 40%-45% of its resources on this activity

Described projects

What priority would you give each potential project—high, medium or low—and why?

Described projects*

	Climate-related risks	Commodity transactions	Cryptocurrencies and related transactions	Discontinued operations and disposal groups
Borrowing costs
Discount rates	Employee benefits	Expenses (Inventory and cost of sales)	Foreign currencies	Going concern
Government grants	Income taxes	Inflation	Intangible assets	Interim financial reporting
Negative interest rates	Operating segments	Other comprehensive income	Pollutant pricing mechanisms	Separate financial statements
Statement of cash flows and related matters	Variable and contingent consideration

You can read the description of a potential project by clicking on the project title.

Find us online

Join our team: go.ifrs.org/careers

UK Endorsement Board Draft Comment Letter: Recommendations

Open for comment until 31 August 2021

Retain flexibility to address the interaction between IFRS and any future international sustainability standards from the ISSB
Allocate more resource to digital financial reporting
Anticipate and address emerging issues through a structured and cohesive research programme
Add three large-scope high-priority projects:
- Climate-related risk
- Intangibles
- Statement of cash flows
Take a cross-standard approach
Consider whether any projects on the current work plan could be paused

High-priority projects

The high-priority projects include:

Climate-related risk
Intangible Assets
- Cryptocurrencies & related transactions
- Pollutant Pricing Mechanisms
Statement of cash flows and related matters