Due Process Compliance Statement - Endorsement of Lease Liability in a Sale and Leaseback - Amendments to IFRS 16
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 Amendments were included in the UKEB technical work plan published in October 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 17 November 2022 Board meeting. |
| Mandatory | Outreach plan for stakeholders and communication approach outlined | Complete: Due to the narrow-scope nature 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: 1 project manager supported and overseen by 1 senior project director. | |
| 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: PIP approved at 17 November 2022 Board meeting. | |
| Optional | UKEB education or initial assessment | Complete: Whilst an education session was not organised, the Board was provided with an update on the project at the September 2022 Board meeting covering background information on the Exposure Draft (ED) proposals and on the UKEB Final Comment Letter (FCL), 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 September 2022 meeting. 17 November 2022: the Board approved the PIP. 14 December 2022: the Board reviewed and approved the DECA for consultation. 27 April 2023: Approval of the Adoption Package consisting of:
|
| 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: The project webpage was created in September 2022. It is 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. A News Alert was also issued, alerting subscribers to the DECA publication. |
| Mandatory | Project email address | 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:
|
|
| Outreach activities [Handbook 6.18-6.22] | |||
| Consult with a representative range of stakeholders before adoption | Mandatory | Evidence of consultation | Due to the narrow-scope nature of the Amendments, consultation activities were focused on obtaining responses to the Draft Endorsement Criteria Assessment (DECA). The UKEB received six 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 17 November 2022 Board meeting the Board decided that the comment period for public consultation should be 90 days and approved the overall project plan. The DECA was published for consultation on 5 January 2023 (comment period deadline 5 April 2023). | |
| Mandatory | Review and approval at UKEB public meeting | Complete: Approved at 14 December 2022 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 90-day consultation period from 5 January 2023 to 5 April 2022. | |
| Mandatory | News Alert to announce publication | Complete: News Alert posted on 5 January 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 six 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. |
| 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 April 2023 public meeting. The Board approved the final feedback statement, subject to minor editorial changes. | |
| Mandatory | Feedback statement posted on UKEB Website | Complete: Final feedback statement published on 16 May 2023. | |
| Mandatory | News Alert published to announce publication | Complete: News Alert announcing adoption of the Amendments published on 16 May 2023. | |
| Due Process Compliance Statement (DPCS) | |||
| Mandatory | Due Process Compliance Statement approved by UKEB in public meeting | Complete: A [draft] DPCS was presented for approval to the Board at its April 2023 public meeting. Final DPCS presented for noting at the Board's June 2023 meeting. | |
| Mandatory | Due Process Compliance Statement posted on UKEB Website | Complete: Final Due Process Compliance Statement published on UKEB website subsequent to the 22 June 2023 Board meeting. | |
| Adoption Statement | |||
| Mandatory | Adoption statements approved by UKEB in public meeting | Complete: Adoption statement for the Amendments was presented for approval to the Board at its April 2023 public meeting. | |
| Mandatory | Adoption statements posted on UKEB Website | Complete: Final Adoption statement of the Amendments published on 16 May 2023. | |
| Mandatory | News Alert published to announce publication | Complete: News Alert announcing adoption of the Amendments published on 16 May 2023. | |
| Voting on adoption of the Amendments | |||
| Mandatory | Tentative vote | Complete: Tentative vote took place at the April Board meeting based on the discussion of the 'adoption package', which included a draft final ECA, a draft feedback statement, a draft due process compliance statement, a draft adoption statement for the Amendments, and the text of the UK-adopted international accounting standard (Amendments to IFRS 16). 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 4/5/23 (written forms due by 11/5/23). Vote formalised via Board members signing the formal voting forms. | |
| Mandatory | News Alert published to announce the outcome of the vote within 3 working days of the formal vote | Complete: News Alert announcing adoption of the Amendments published on 16 May 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.